The alarms go off in the Spanish economy. The Funcas Panel, which collects the analyzes of 19 study services, already sees a fall in the Spanish economy at the end of the year. Specifically, economists predict that the GDP it will decrease by 0.2% in the last quarter of 2022.
The horizon does not invite optimism in Spain. After a second quarter of growth of 1.1%, more than expected, the second part of the year came to a halt. The organization forecasts that the GDP will register "very weak growth" in the third quarter, of only 0.1%, to fall by 0.2% in the immediately following period. It is not enough to be considered a recession since it should be two consecutive quarters, but the word is already beginning to hang over the Spanish economy. «The Funcas Panel forecasts a sharp slowdown in the economy in the second half of 2022, with very weak growth (0.1%) in the third quarter -after 1.1% in the second- and a drop of two tenths in the fourth, with the majority of panelists expecting a negative result in that last quarter, "says the institution.
Also, the data for next year are not encouraging. The growth estimate for 2022 remains at 4.2%, but for 2023 it is reduced by six tenths, from 2.5% to 1.9%, due to the persistence of inflation and increases in interest rates of the European Central Bank (ECB). "The sharp slowdown anticipated for the second half of 2022 has an impact on the growth rate forecast for 2023, which, as a result of a lower drag effect, is reduced by six tenths, compared to the previous forecast, to 1.9%«, indicates the panel.
The data for 2023 is related to how the quarter-on-quarter GDP will also behave in each period of that year. In the first quarter, Funcas predicts a rise of 0.3%; 0.7% in the second; and 0.8% in the third and fourth. This contrasts with what was expected in the previous panel, from July, which were rises of 0.7%, 0.9%, 1% and 0.9%, respectively.
Thus, the deterioration of the economic situation for the year 2023 is due to a reduction in private consumption by six tenths for that year; 1.1 points less in investment in machinery and capital goods. All this ending in a contribution of national demand six tenths lower than expected in July.
In terms of inflation, Funcas does not see too many signs for optimism either, after the latest data this summer. "After increases of more than 10% in June, July and August in year-on-year terms, the panelists expect a moderation in inflation in the remaining months of the year due largely to base effects. Even so, the forecast for the rate of Average annual inflation for 2022 rises seven tenths, to 8.6%, while that corresponding to core inflation increases by four tenths, to 5%.As for 2023, the consensus forecast has been revised upwards to 3.8%, both for the general CPI and the underlying one", they point out in the institution.