* IOBE sees 4.6 pct recession, slightly deeper than govt forecast
* Projects unemployment to rise to 27.3 pct in 2013
* Inflation to slow to 1.0 pct
ATHENS, Jan 10 (Reuters) - Greece’s economy will contract by 4.6 percent this year, the influential think tank IOBE projected, taking a slightly more pessimistic view than the government and the country’s lenders.
Athens is pushing through more austerity prescribed by its international lenders to shore up its finances, which is expected to keep its economy in recession for a sixth consecutive year and push record unemployment to new highs.
“The economy is entering 2013 with the prospect of a milder but continuing recession. The main cause is the drop in private consumption, which feeds three quarters of gross domestic product (GDP),” the Foundation for Economic and Industrial Research (IOBE) said in its latest quarterly report.
It said austerity measures including increased taxes and cuts in public sector pay and pensions would have a negative impact on purchasing power, weighing on consumption.
The government projects an economic contraction of 4.5 percent this year after an estimated 6.5 percent slump in 2012, while the European Union and the International Monetary Fund bailing out the country expect a contraction of 4.2 percent.
IOBE said that quarterly GDP growth rates would begin turning positive by the end of 2013 or in early 2014.
“The determining factor for the beginning of recovery will be investments -- public works, investment that will result from privatisations and capital inflows from abroad,” IOBE said.
It projected that a further drop in imports will lead to a surplus in the trade balance which could have a positive impact on GDP.
The think tank expects unemployment to rise further to 27.3 percent this year as the recession drags on.
Data released on Thursday showed further evidence of the economic malaise as unemployment climbed to a new record of 26.8 percent in October. The rate among youth aged 15-24 also touched a new record of 56.6 percent.
The report also forecast that inflation would slow further this year to average out at 1.0 percent, due to weak consumer demand.