Bank of America (BofA) is striking an optimistic tone on the
Bank of America (BofA) is striking an optimistic tone on the prospects of the eurozone periphery, despite the lingering impact of trade tariff shocks that have somewhat delayed the region’s growth momentum. Greece follows this positive trend according to the bank’s latest analysis.
Bank of America forecasts the eurozone’s peripheral economies will continue to outpace the broader bloc in 2025 and 2026. However, it warns that uneven post-2020 recoveries and differing growth structures pose ongoing risks. Added pressures from tariff uncertainty and rising bond yields further cloud the outlook.
Bank of America highlights fiscal policy as a key vulnerability, noting limited room for national governments to act independently. With pressures from post-pandemic shifts and evolving policy landscapes, careful fiscal management will be essential.
Despite the common pressures, regional economies on the eurozone’s periphery have largely outperformed the broader average since the pandemic.
Greece, in particular, is highlighted for the strength and consistency of its performance, which BofA attributes to three main factors that emerged in the pandemic era: a significant rebound in capital expenditure, a relatively muted transmission of European Central Bank monetary tightening, and a steadfast commitment to fiscal discipline and structural reforms.
These same factors—especially the investment recovery and reform momentum—are
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