ATHENS – The Greek economy will contract between 4.5-9.5 pct this year, Bank of Greece governor Yannis Stournaras said on Monday. Addressing a parliamentary commission to support his nomination for another term at the helm of the central bank, Stournaras said he expected the Greek economy to then recover at a rate of 5.5 pct GDP growth in 2021 but noted that the pandemic was causing uncertainty "since a lack of a vaccine maintains this sense of fear and creates conditions of stagnation and possibly fears of stagflation if it continues."

He said that Greece had been successful in dealing with the pandemic and had thus laid the foundations for as shallow a recession as possible. Stournaras said the basic scenario for the Greek economy forecasts a 6.0 pct recession in 2020 and a 5.5 pct recovery in 2021. He added that credit expansion was estimated at 15 billion euros at least this year and noted that Greek banks were fully covered, in terms of liquidity and capital, in order to help preserve the productive fabric of the economy.