Spain: GDP contracts at softer pace in first quarter
April 30, 2013
In the first quarter, GDP contracted 0.5% over the previous period in seasonally adjusted terms, according to preliminary data released by the National Statistics Office (INE) on 30 April. The print, which matched both the Bank of Spain's estimate and last month's FocusEconomics Consensus Forecast, followed the 0.8% contraction recorded in the fourth quarter. Nevertheless, the Q1 figure marks the seventh consecutive quarter of declining growth, as draconian austerity measures and rampant unemployment continue to drag on domestic demand.
On an annual basis, GDP declined 2.0% in the first quarter, a deterioration over the 1.9% drop recorded in the last quarter of 2012. More detailed data will be released on 30 May.
The government recently revised its growth forecasts and now expects the economy to contract 1.3% this year. FocusEconomics Consensus Forecast panellists are more pessimistic and anticipate GDP contracting 1.6% in 2013, which is down 0.1 percentage points from last month's forecast. In 2014, panellists expect the economy to expand 0.3%.