Economic growth should remain robust this year and next thanks to consumer spending, boosted by falling unemployment, and investment, brokerage Jefferies said in a note to investors. Spain's unemployment rate dropped in the fourth quarter to its lowest level in 16 years, data showed on Tuesday.
Still, the rising cost of living and a housing crisis that has pushed prices through the roof in big cities has dented living standards despite the growth, head of strategy at Renta 4 brokerage Natalia Aguirre told Reuters, forecasting a slowdown in private consumption.
Analysts also point to Spain's below-par GDP per capita in Western Europe and its snail-paced growth that clocked just about 4% since 2007.
The country's economy expanded 0.8% in the last three months of the year from the previous three, the same pace as the quarter before. Analysts polled by Reuters had expected gross domestic product to grow 0.6% quarter-on-quarter.
The full-year growth rate was faster than the 2.7% projected by the government and even the 3.1% predicted by the Central Bank.
"Spain keeps leading the euro zone growth, with a GDP increase four times higher than the euro zone as a whole," Cuerpo said in a statement.
Recently both France and Germany lowered their growth outlooks for this year to 0.9% and 0.3% respectively, while Italy expects a 1.2% expansion. All three are due to release GDP data on Thursday.
Additionally, Spain's fiscal situation is better than its peers', Jefferies said, and it is less likely to suffer from U.S. President Donald Trump's plans to impose trade tariffs.
The budget deficit is set to fall this year and next thanks to higher taxes and cuts in subsidies such as the one on electricity. Spain expects to reduce its budget deficit to 2.5% this year.
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“But when an economy is doing well in a 'socialist' country it's nothing to do with the government at all” Not according to Sra Montero, Sra Diaz as well as the MDB editorial team and much of the international press.
Richard PearsonNothing at all of course - when an economy in a conservative run country is doing well it's all down to the government. But when an economy is doing well in a 'socialist' country it's nothing to do with the government at all. Especially when the government are trying to turn the country into Venezuela, the USSR etc etc
What has Sánchez got to do with all of this ? Are you both saying that socialist governments are incapable of running a country’s economy successfully ? By the way, it would be worth studying the details about what is referred to by the MDB editor as an economic “miracle”. It should be noted that a growing GDP isn’t the be all and end-all of the economic success of a country and more importantly of its inhabitants.
Zoltan TeglasYes 100% Trotskyist! Waiting to hear what the Daily Mail gang have to say on this news...
Must be fake news. as according to many on here Sanchez is a god damn commie, and is turning Spain into a 3rd world country.