Question

• Provide a general introduction on the Spanish economy with data on the main macroeconomic indicators (GDP growth, unemployment rate, inflation, current account balance (Import and exports) over the last decade providing the necessary data.

Answer 1

Spain Economic Outlook

The economy gained steam within the final stretch of 2018 as quarterly growth in q4 picked up a notch from a solid Q3 production, sharply contrastive the mediocre performance within the Euro zone overall. The pick-up was for the most part underpinned by a robust rebound in exports and multi-year high growth publicly outlay. Slower non-public consumption and a contraction in mounted investment weighed on the headline figure, however. Meanwhile, obtainable knowledge suggests that the solid momentum carried over into 2019: In Jan, the composite PMI hit a seven-month high, for the most part reflective improved business conditions within the producing business, whereas economic sentiment bounced back from associate over biennial low. within the field, on fifteen February, Prime Minister Pedro Sanchez known as a snap election for twenty eight April when Catalan pro-independence parties, that had backed his government previously, joined with the opposition to reject his draft 2019 budget 2 days earlier.

Spain economic growth

Growth is seen slowing this year because the current economic cycle matures. non-public consumption is ready to ease as employment growth slows and wage gains moderate, whereas investment activity can be dampened by modification monetary conditions. additionally, the very important business business has reached its peak and is ready to cool going forward, motility a serious current of air to job creation and economic activity overall. Heightened political uncertainty over the end result of the final election and its repercussions on policy additionally cloud the outlook. Focus Economics panelists project growth of 2.2% in 2019, that is unchanged from last month’s estimate, and 1.8% in 2020.

Spain Economy Data

	2013	2014	2015	2016	2017
Population (million)	46.6	46.5	46.4	46.4	46.3
GDP per capita (EUR)	22,014	22,340	23,271	24,107	25,115
GDP (EUR bn)	1,026	1,038	1,080	1,119	1,164
Economic Growth (GDP, annual variation in %)	-1.7	1.4	3.4	3.3	3.1
Domestic Demand (annual variation in %)	-3.2	1.9	4.0	2.6	2.9
Consumption (annual variation in %)	-3.2	1.5	3.0	2.9	2.4
Investment (annual variation in %)	-3.4	4.7	6.5	3.3	5.0
Exports (G&S, annual variation in %)	4.3	4.3	4.2	4.8	5.0
Imports (G&S, annual variation in %)	-0.5	6.6	5.9	2.7	4.7
Industrial Production (annual variation in %)	-1.6	1.2	3.2	1.9	3.1
Retail Sales (annual variation in %)	-3.9	0.9	4.2	3.9	0.7
Unemployment Rate	26.1	24.4	22.1	19.6	17.2
Fiscal Balance (% of GDP)	-7.0	-6.0	-5.3	-4.5	-3.1
Public Debt (% of GDP)	95.5	100	99.4	99.0	98.3
Inflation Rate (HICP, annual variation in %, eop)	0.3	-1.1	-0.1	1.4	1.2
Inflation Rate (HICP, annual variation in %)	1.5	-0.2	-0.6	-0.3	2.0
Inflation (PPI, annual variation in %)	0.6	-1.3	-2.1	-3.1	4.4
Policy Interest Rate (%)	0.25	0.05	0.05	0.0	0.0
Stock Market (annual variation in %)	21.4	3.7	-7.2	-2.0	7.4
Exchange Rate (vs USD)	1.38	1.21	1.09	1.05	1.20
Exchange Rate (vs USD, aop)	1.33	1.33	1.11	1.11	1.13
Current Account (% of GDP)	1.5	1.1	1.1	1.9	1.9
Current Account Balance (EUR bn)	15.6	11.2	12.2	21.5	22.2
Trade Balance (EUR billion)	-16.0	-24.5	-24.2	-18.8	-24.7