The Spanish economy is definitely in the process of slowing down. The country’s growth in the third quarter of the year was only 0.1%. This is confirmed by the National Institute of Statistics (INE), which has just published the final data from the National Accounts. The figure is one tenth lower than the GDP data advanced a few weeks ago.
The data known this Friday is 1.9 points lower than that of the second quarter, which comes to show that, despite the summer, the tourism engine has not had the necessary power to give the definitive push that the Spanish economy needed. Therefore, it now remains to see the behavior of consumption in the last quarter of the year to verify to what extent the economic slowdown becomes a reality.
for now, The possibility of a technical recession in Spain seems to be receding (two consecutive negative quarters). In annualized terms the situation is very different. It seems increasingly likely to achieve growth of 4.4% this year as forecast by the Government. In fact, this quarter the Executive’s objective would have been reached, although it is more than three points lower than that of the previous quarter. However, we will have to wait to see the behavior of the end of the year.
The INE has updated the figures for the first months of the year. Specific, has revised upwards the growth of the second trimesterto the 2%so the slowdown of the economy in the third quarter was 1.9 points.
The institute justifies this update of the figures advanced a few weeks ago since at that time the data used was only complete up to the month of August. Now, on the other hand, the usual databases have been incorporated, and even some new ones that allow it to offer a much more accurate vision of the reality of the Spanish economy.
[El Banco de España recorta al 1,4% el crecimiento de 2023 y sube en más de tres puntos la inflación esperada]
The contribution of national demand to the year-on-year growth of GDP is 0.9 points, 1.6 points lower than that of the second quarter. For its part, external demand presents a contribution of 3.6 points, 1.5 points less than in the previous quarter.
The consumption of the Public Administrations pulls the Spanish economy in the third quarter of the year. It went from -1.4% in the previous quarter to 1.4% in this one. However, Household consumption continues to fall, in line with what was expected due to the evolution of the summer season.
Families decided to go from more to less in the third quarter and, finally, their contribution to spending was 0.1% compared to 1.7% the previous year. This means that there was great mistrust in the future of the economy on the part of households.
Exports of goods and services present a variation of 18.8% compared to the third quarter of 2021, a drop of 4.9 points compared to the previous quarter. This is due to the moderation of the interannual rates of exports of goods (which closed at 2.6%) and exports of services, which fell to 68.3%.
sharp decline in the industry
Imports of goods and services grew by 9.0% compared to the same quarter of the previous year, three tenths more than in the second quarter. This acceleration is explained by the increase in imports of goods (from 5.1% to 7.0%) partially offset by a reduction in the interannual variation of imports of services (from 28.7% to 19.8% ).
Worrying the drop in industry, whose contribution to GDP went from 1.8% to -0.1% this quarter.
[El Banco de España avisa de que la recuperación del PIB perdido en la pandemia se retrasará hasta 2024]
The number of hours actually worked varies by −0.1% compared to the second quarter, 1.2 points less than in the previous quarter. In year-on-year terms, the number of hours actually worked grew by 3.3%, a rate similar to that of the previous quarter.
The interannual variation rate of hours worked in the industrial branches stands at 4.5%, which means 4.4 points more than in the previous quarter.
The unit labor cost (ULC) grows by 0.7% compared to the third quarter of 2021. This rate is 3.4 points lower than the variation experienced by the implicit deflator of the economy (4.1%)