Spain: GDP growth was depressed at 0.2% in 2nd quarter.
08/26/2011 6:22 DJLL002054N/DJS1 N / DJSW N / EDJ N / LL / R / R EC / EU R / SP / / By Christopher Bjork
DOW JONES NEWSWIRES
MADRID (Dow Jones) - Spain’s economic growth is
slowed in the second quarter because the fourth
Eurozone economy suffered the effects of
slowdown in export growth and a crash
domestic demand, while economists warned that
further weakness ahead.
According to data released Friday by the National Institute of
Statistics, or INE, the GDP grew by 0.2%
quarter in the second quarter, which grew by 0.7%
The INE also revised up its estimate of first
quarter in a tenth to a 0.4%
quarter and 0.9% yoy.
The data are in line with the estimate
conducted by the INE earlier this month, reflecting the growth
Spain’s economic needs to be accelerated significantly in
the second half for the Government to meet the target of a
growth of 1.3% in 2011.
The private sector economists believe, mostly to
going to happen otherwise.
Unicredit economist Tullia Bucco said that the contraction
domestic demand is likely to worsen in the second half
the year. "The recent tightening in financial conditions
inevitably weigh on investor confidence,
while fiscal austerity will continue to pose a high
toll on economic activity, "he said in a note.
The recent softening of economic growth
eurozone and the United States has clouded the outlook for the battered
Spanish economy, which now depends largely on the
strong exports. The euro zone grew by 1.8%
year in the second quarter, down 2.5% had
grown in the first.
The disaggregated data provided by the INE point to new
difficulties in the future. Gross exports fell year on
quarter for the first time in two years. Exports
goods and services fell by 1.9% quarter compared to growth
from 5.8% the previous quarter.
Net exports - or external demand - remained still,
as the main engine of growth, and contributed 2.6 points
annual percentage of GDP data for the second quarter. Without
But that was mainly the result of a fall
quarter of 4% in imports of goods and services.
Domestic demand, meanwhile, remained weak, with reduced
purchasing power by high unemployment.
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