Spain's Economic Growth Steady in Third Quarter Amid Increased Public Spending and Household Consumption
The Spanish economy maintained a steady growth rate of 0.8% in the third quarter of the year, matching the rate from the previous quarter. This growth was primarily driven by a significant increase in public spending, which rose at a quarterly rate of 2.2%, showing a notable 1.6-point increase from the prior quarter. Additionally, household consumption saw a rise of 1.1%, a slight improvement of one-tenth from the previous period.
According to preliminary National Accounting data released by the National Institute of Statistics (INE), the year-on-year Gross Domestic Product (GDP) experienced a noteworthy increase of 3.4%, up two-tenths from the second quarter and marking the highest growth rate in the last eighteen months. The Ministry of Economy, Trade, and Enterprise highlighted this development in an assessment shared with the media, indicating a positive revision of the previous quarter's year-on-year growth from 3.1% to 3.2%.
In the third quarter, domestic demand was a significant contributor to the year-on-year GDP increase, adding 2.7 percentage points, while external demand contributed 0.7 tenths. Meanwhile, domestically, the quarterly GDP growth of 0.8% was also supported by internal demand, which provided a boost of 0.9 percentage points, despite a slight negative contribution of -0.1 from the external sector.
Conversely, despite the overall positive trends in household consumption and public administration, investments saw a downturn, declining by 0.9% in the third quarter after experiencing three consecutive quarters of growth. This regression was largely attributed to a 1.7% decrease in housing investments compared to the previous quarter.
The Ministry of Economy noted that the latest data points reflect a well-rounded and resilient growth in the Spanish economy, a sentiment echoed by multiple national and international organizations, indicating that Spain’s economic recovery is on a promising trajectory.
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