The Basque Autonomous Community, Navarre and Galicia are leading the upward revisions in 2023. Consumption is starting to slow due to inflation and the momentum of tourism may also be affected.
Euskaraz irakurri: BBVA Researchek gorantz berrikusi du Euskadiko BPGren hazkundea 2023an, % 0.8th art
BBVA Research has revised the growth forecast for the Basque Country upwards from 0.3% to 0.8% for 2023 and an estimated 3.4% for 2024. The research service BBVA maintains its year-end forecast for the Basque Country at 3.5%.
These estimates come from the latest report “Situation Spain”, presented by the entity this Thursday. Spain’s GDP growth forecast for 2022 is 4.6%, an upward revision from the previous estimate (4.4%).
In particular, the Basque Autonomous Community, Navarre and Galicia are leading the upward revisions in 2023. In 2024, activity will increase by 3.4%, driven by the normalization of activity in Europe and the higher implementation rate of the NGEU funds.
The consumption begins to suffer a delay due to inflation, uncertainty and less job creation. However, card spending recorded at BBVA POS terminals shows that household spending, in real terms, continues to grow in all communities in the fourth quarter of this year.
The study underlines this with regard to social security affiliation surprising resistance of work behaviorwhich remains positive after a slowdown in the third quarter of this year.
BBVA Research has drawn attention to some of the risks to be reckoned with in the Spanish economy for the coming years. The first of them, the possibility that the tourism is not pushing that much as in the past two years and doubts about its evolution in the coming quarters, given the “registered loss of competitiveness, the adjustment of demand due to the fall in household income and possible changes in consumption habits”.
Another risk is inflation, which may remain high in the coming months. As they noted, the price increase, previously mainly related to energy, is becoming generalized, suggesting that companies are “trying to regain some of the lost profitability.” Wages are rising, but without restoring pre-pandemic purchasing power, which is why they believe “the consolidation of the income deal will be key to the future evolution of inflation”.
Finally, they stressed that while the implementation of the NGEU funds seems to be gaining momentum, their impact “will still take time to reach households and businesses”.
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Source: EITB
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
