The Savings Bank Foundation (Funcas) expects that in the final stretch of this year, 2023, there will be a “significant slowdown” in economic growth or that it will even be zero in the last quarteralthough it rules out that if the political “interim” situation is prolonged with the Government in office, additional negative effects may occur.
This was stated in statements to Servimedia by the senior economist at Funcas, María Jesús Hernández, coinciding with the publication this week of record data on foreign tourist arrivals to Spain in July and expense thereof.
Hernández explained that it is being a “very good” tourist season but clarified that “This summer’s information does not change perspectives“which, in his opinion, could have been of low growth or even zero in recent months.
“We see that Europe is going through a complicated stage. Here not in such a pronounced way, but the activity indicators until June pointed to a downward trend and those for July and August, which are qualitative and economic sentiment, have worsened considerably,” this economist warned.
In fact, he indicated that the slowdown in growth will not come so much from domestic consumption in Spain but from the situation of neighboring countries and, consequently, the behavior of exports.
This Funcas expert pointed out that the indicator that is holding up best is employment and, although she hopes that there will be a “slowdown” in Social Security affiliation In the coming months, “we see that this data is holding up better than expected.”
Refering to evolution of inflationHernández foresees that the general rate will increase in recent months, while the underlying rate, which does not include energy and unprocessed foods, will reduce, so that they will “converge” at the end of this year.
Economy and politics
According to the data provided by the National Institute of Statistics (INE) for the month of August, General inflation was 2.6% and core inflation was 6.1%.
On the other hand, this expert ruled out that if there is a political blockade situation and the Government remains in office, the economy will be harmed. “We have previous experiences, like in 2016, and the economy continued to grow,” he said.
Of course, he warned that what can “scare” economic agents is that in the negotiation process to form a new Government proposals that may be “negative” for the economy are put on the table.