Greece’s apparent improvement in competitiveness and recent economic recovery might suggest that it no longer requires a weaker currency and so would have little to gain from leaving the euro-zone. But a weaker currency would help to use up the vast amounts of spare capacity in the economy more quickly and hence reduce the threat of a very deep and prolonged bout of deflation.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services