Madrid: The Spanish economy slowed in the third quarter, indicating the recovery may have peaked ahead of next month’s general election.
Import growth accelerated to 4 per cent from 1.6 per cent in the previous quarter as gross domestic product expanded by 0.8 per cent, the Madrid-based National Statistics Institute said Thursday. Exports rose 2.8 per cent in the three months to September, while household consumption increased by 1 per cent.
Spain’s economy is among the fastest growing in the euro region this year as employment rises and lower energy prices coupled with tax breaks and easier financing conditions boost spending power. In its monthly economic bulletin published November 24, the Bank of Spain said expenditure by families on consumer goods maintained a “high level of dynamism” going into the fourth quarter.
Prime Minister Mariano Rajoy, who faces a ballot on December 20, has forecast the economy will expand 3.3 per cent this year and 3 per cent in 2016. The 60-year-old conservative is campaigning on a platform of growth and stability, presenting himself as the guardian of the recovery.
Ninth consecutive quarter of growth
The pace of quarterly expansion matched the statistics office’s initial estimate released Oct. 30. That’s down from 1 per cent in the second quarter, marking the ninth consecutive quarter of growth. From a year ago, GDP increased 3.4 per cent, while the pace of job creation accelerated to 3.1 per cent.
Despite the slowdown in the third quarter, Economy Minister Luis de Guindos said growth remains strong and the economy will “clearly” expand by more than 3 per cent this year. Earlier this week, Budget Minister Cristobal Montoro said the pace of tax collection through October pointed to sustained expansion this quarter, which includes the crucial Christmas period. The European Commission expects growth of 2.8 per cent in 2015 and 2.6 per cent next year.
