Spain’s economy leads the way as the Eurozone begins to fight back
By Liam Sheasby, News Editor
01 May 2019
Pedro Sánchez: Spain's Prime Minister and leader of Partido Socialista Obrero Español (Spanish Socialist Worker's Party)
The Spanish economy has reported a 0.7% growth in GDP this week; up from the previous quarter’s growth of 0.6% and with twice as much economic growth as neighbouring France.
The news is timely for Prime Minister Pedro Sanchez and his Socialist Party, having just won the largest number of seats in the Spanish election but still being short of a majority. The positive economic figures could be enough to tempt uncertain rival parties into a coalition to break the hung parliament.
The Eurozone also posted improved figures with 0.4% GDP growth across the region; up from 0.2% in the fourth quarter of 2018. Italy was the surprise package of the 19-nation bunch, with 0.2% GDP growth bringing the beleaguered country back from its third recession in a decade.
The figures for Q1 2019 were reported by the Instituto Nacional de Estadística de España (National Statistics Institute of Spain) as shown by the chart below:
CNTR. Avance Trimestre 1/2019. El #PIB español registra un crecimiento del 0,7% en el primer trimestre de 2019 respecto al trimestre anterior en términos de volumen. Nota de prensa: https://t.co/sL9fzHACEJ Más resultados: https://t.co/vWvQIJ1vju #INE #economía pic.twitter.com/QcbpFJ1Fkb— INE España (@es_INE) April 30, 2019
The data also shows that Spain’s economy grew 2.4% faster in the first quarter of this year compared to the same period last year, with Bloomberg describing the gains as unexpected. Spain has now grown consistently since 2013.
The 0.7% growth realised in Q1 means that Spain’s economy has outperformed the Eurozone average for the past five quarters, with higher wages helping to stimulate consumer spending. The Spanish government – led by the re-elected Pedro Sanchez – estimates that Spain will achieve 2.2% overall growth this year.
One big concern is that Spain’s unemployment has risen again though – up from 13.9% in February to 14.7%. This comes off the back of nearly 600,000 jobs created in the last year; a figure not seen since before the financial crisis back in 2007.
It is perhaps the talk of uncertainty surrounding the re-elected Socialist government and their need to form a coalition, combined with the sudden rise in unemployment, that prompted Spain’s Antena3 (their equivalent of ITV) to run a feature on gold in their show Espejo Público (Public Mirror). The segment reported how gold demand in Spain was up around 50%, though without citation on their figures. Our sister website, Inversoro.es, has reported a rise in registrations, enquiries and orders in the past fortnight however, suggesting that appetite for physical gold is indeed rising in Spain – even if it’s not by the figure suggested in the Spanish media.