The Greek economy’s 0.60% GDP growth in Q3 2025 marks a significant rebound from the previous quarter’s flat reading and outpaces the 0.20% consensus estimate. This growth rate is the strongest since Q1 2025’s 0.90% and compares favorably to the 12-month average of 0.48%. Greece’s recovery trajectory remains uneven but shows resilience amid global uncertainties.

Drivers this month

• Domestic consumption contributed 0.25 percentage points (pp), driven by rising retail sales and tourism inflows.
• Exports added 0.20 pp, supported by stronger demand from the Eurozone and emerging markets.
• Investment growth slowed, subtracting -0.05 pp, reflecting cautious corporate spending amid geopolitical risks.
• Government spending added 0.10 pp, reflecting fiscal stimulus measures targeting infrastructure and green energy.

Policy pulse

The 0.60% growth rate sits comfortably above the European Central Bank’s inflation target zone, supporting a gradual normalization of monetary policy. The ECB’s cautious stance on interest rates aligns with Greece’s improving output gap, though inflationary pressures remain moderate.

Market lens

Immediate reaction: The EUR/GRD currency pair appreciated 0.30% within the first hour post-release, reflecting investor confidence. Greek government bond yields tightened by 8 basis points, signaling reduced risk premia. The Athens Stock Exchange benchmark ATHEX rose 1.20%, led by cyclical sectors.

Core macroeconomic indicators underpinning Greece’s growth include stable inflation, improving labor market conditions, and manageable fiscal deficits. Inflation held steady at 2.10% YoY in August 2025, close to the ECB’s target. Unemployment declined to 11.50%, the lowest since 2010, supporting household spending.

Monetary Policy & Financial Conditions

The ECB’s key interest rate remains at 3.50%, unchanged since June 2025, balancing growth support with inflation control. Credit conditions eased slightly, with bank lending to the private sector growing 2.30% YoY. The Greek banking sector’s non-performing loan ratio improved to 6.80%, enhancing financial stability.

Fiscal Policy & Government Budget

Greece’s fiscal deficit narrowed to 3.20% of GDP in H1 2025, down from 3.80% a year earlier, aided by higher tax revenues and controlled spending. The government’s 2025 budget targets a primary surplus of 1.50%, consistent with EU fiscal rules. Public investment in infrastructure and green projects remains a priority.

External Shocks & Geopolitical Risks

Regional tensions in the Eastern Mediterranean and energy price volatility pose downside risks. However, Greece’s diversified export base and EU support mechanisms mitigate immediate shocks. The ongoing energy transition reduces dependency on fossil fuels, enhancing resilience.

Market lens

Immediate reaction: Greek 2-year government bond yields fell by 10 basis points post-release, reflecting improved growth expectations. The EUR/GRD currency pair strengthened by 0.30%, and the ATHEX index gained 1.20%, led by industrial and consumer discretionary sectors.

Looking ahead, Greece’s GDP growth faces a mix of supportive and challenging factors. The baseline scenario projects 0.50–0.70% QoQ growth in Q4 2025, driven by sustained domestic demand and export resilience. Inflation is expected to remain near 2%, allowing the ECB to maintain a steady policy stance.

Bullish scenario (30% probability)

• Stronger-than-expected tourism recovery boosts services sector.
• EU green transition funds accelerate infrastructure investment.
• Geopolitical tensions ease, improving investor sentiment.
• GDP growth exceeds 0.80% QoQ in Q4 2025.

Base scenario (50% probability)

• Moderate consumption and export growth sustain 0.50–0.70% QoQ GDP gains.
• Fiscal discipline maintained, supporting debt sustainability.
• ECB holds rates steady amid balanced inflation risks.

Bearish scenario (20% probability)

• Energy price shocks and regional instability dampen growth.
• Investment remains weak due to global uncertainty.
• GDP growth slows to below 0.30% QoQ or contracts.

Policy pulse

Monetary policy is likely to remain accommodative but vigilant. The ECB’s forward guidance will hinge on inflation dynamics and growth momentum. Fiscal policy may tilt toward targeted stimulus if downside risks materialize.

Greece’s 0.60% GDP growth in Q3 2025 signals a cautiously optimistic phase in its economic recovery. The interplay of domestic demand, export strength, and prudent fiscal management underpins this progress. However, external risks and investment hesitancy temper the outlook. Policymakers must balance growth support with inflation control to sustain momentum.

Structural reforms, especially in labor markets and digital infrastructure, remain critical for long-run growth. The energy transition offers both challenges and opportunities, positioning Greece for a more resilient economic future.

Key Markets Likely to React to GDP Growth Rate QoQ

Greece’s GDP growth data typically influences equity, bond, and currency markets sensitive to economic momentum and risk sentiment. Investors track these indicators closely to adjust exposure and hedge risks.

• ATHEX: Greece’s primary stock index, highly correlated with GDP growth and domestic economic health.
• EURGRD: The Euro to Greek Drachma pair reflects currency strength linked to economic fundamentals.
• FTSE: UK market often moves in tandem with Eurozone growth trends, impacting Greece indirectly.
• EURUSD: Euro’s global strength is influenced by Eurozone GDP data, including Greece’s contributions.
• BTCUSD: Bitcoin’s risk-on/risk-off dynamics sometimes correlate inversely with traditional growth indicators.

GDP Growth Rate QoQ vs. ATHEX Index Since 2020

Since 2020, the ATHEX index has shown a positive correlation with Greece’s quarterly GDP growth rates. Periods of accelerated GDP growth, such as Q3 2024’s 1.10%, coincided with notable stock market rallies. Conversely, contractions or stagnation phases saw market pullbacks. This relationship underscores the ATHEX’s sensitivity to domestic economic conditions and investor confidence.

Quarter	GDP Growth QoQ (%)	ATHEX % Change
Q3 2024	1.10	5.30%
Q4 2024	0.30	1.20%
Q1 2025	0.90	3.80%
Q2 2025	0.00	-0.50%
Q3 2025	0.60	1.20%

FAQs

What does the latest GDP Growth Rate QoQ indicate for Greece?

The 0.60% QoQ growth suggests a moderate economic rebound, driven by consumption and exports, signaling improved momentum after a flat previous quarter.

How does Greece’s GDP growth affect monetary policy?

Stronger GDP growth supports a gradual normalization of ECB policy, balancing inflation control with growth support in the Eurozone.

What are the main risks to Greece’s GDP outlook?

Key risks include energy price volatility, geopolitical tensions in the region, and subdued investment, which could slow growth below expectations.

Takeaway: Greece’s 0.60% GDP growth in Q3 2025 marks a meaningful recovery phase, supported by domestic demand and exports, but tempered by external risks and investment caution. Policymakers must navigate these dynamics carefully to sustain momentum.

This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.