The International Monetary Fund (IMF) has improved its growth forecast for the Spanish economy in 2014 by three tenths more than their previous forecast, and by two tenths more in 2015, to 0.9% and 1% respectively, as published in their ‘World Economic Outlook’ report, which also notes a more positive evolution in the Spanish labour market.
The upward revision of growth prospects for Spain is the most significant among the major economies, only behind the four and three tenths improvements, respectively, in the forecasts for 2014 and 2015 for the UK, which they estimate will grow by 2.9% this year and 2.5% next year.
However, despite the IMF’s optimistic prediction, the growth forecast for Spain in 2015 is one of the weakest among the eurozone countries, with only Slovenia and Cyprus (each with growth of 0.9%), growing less than Spain next year.
The Spanish Government’s official estimates envisage a GDP growth of 0.7% in 2014 and of 1.2% next year, although the Government will review its forecasts in late April, when it is likely to predict an expansion of around 1% for the current fiscal year.
As a result of the greater strength predicted for the Spanish economy, Europa Press reported that the IMF, headed by Christine Lagarde, has revised downward its outlook for unemployment in Spain and points to a gradual decline in the unemployment rate, to close 2014 at 25.5%, compared to the 26.6% estimated in October, and dropping to 24.9% in 2015.
In addition, with regard to inflation, the IMF expects prices to register an increase of 0.3% in 2014 and 0.8% next year.
The above article was originally published on Kyero, and can be read in its entirety by clicking here.