The Bank of Spain informed that the country's GDP during the third quarter of this year increased by 0.8%, two tenths less than the previous quarter, when it grew by 1%. The central bank, at the same time, supports its growth forecasts for years 2015 (3.1%) and 2016 (2.7%). Therefore, according to the central Bank of Spain, during the period from July to September 2015, the Spanish economy continued to grow, although at a more "moderate" pace than in the first half of the year (0.9% in the first quarter, 1% in the second quarter).
The GDP growth in Spain in the third quarter was supported once again, according to official data from the Bank of Spain, by the growth of domestic demand, compared with external demand, which has retained its negative dynamics.
In the Economic Bulletin of September, the Bank of Spain also established that the quarterly growth of 0.8% in the third quarter would put the annual rate of GDP growth at 3.4%, three tenths more than in the previous quarter.
The Central Bank of Spain, under the direction of Luis Maria Linde, maintains its economic growth forecast for years 2015 (3.1%) and 2016 (2.7%), confirming the "recovery scenario" which has already been forecasted in June this year. However, the experts say that the "uncertainty" of system development under this scenario is "extended" and that the risk of diversion "has grown" due to deteriorating prospects for world economic growth.
What the Bank of Spain changed in its forecasts, are the components of GDP growth in Spain, which was made in June this year. Therefore, it is expected that economic growth during the years 2015 and 2016 will be based on a greater contribution of domestic demand (3.4 points this year and 3 points in the next year), due to growth and accelerating of consumption and investment. Meanwhile, the external demand in Spain will reduce the GDP growth by three tenths during each year, compared with the stagnation of this factor, which was forecasted in June.
This reflects the fact that exports show a more moderate growth than expected (4.9% in 2015 and 5% in 2016), while imports will show higher rates of growth than expected in June (6.3% in 2015 and 6.4% in 2016).
As for domestic demand, the Bank of Spain expects that the household consumption in Spain will continue its "positive dynamic" over the next two years due to the favorable situation on the labor market and an increase in net assets, and all this in the context of "a slight increase" of housing prices.
In particular, according to the Bank of Spain, the private consumption will increase by 3.5% this year and 2.9% next year, which is more than expected in June. Public consumption also will accelerate its rate by 1.1% in 2015 and by 0.3% in 2016, in contrast to the almost stagnant state, which was predicted earlier.
Meanwhile, investment will grow at a faster pace than expected (6.5% this year and 6.6% in 2016), thanks to investments made in the means of production, as well as in the residential property sector. In addition, the real estate market will continue to show a gradual recovery.