Breaking News
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Spain's quarterly growth revised sharply lower, 2021 outlook at risk

Economic IndicatorsSep 23, 2021 07:46AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
2/2 © Reuters. FILE PHOTO: A woman wearing a protective mask walks past a closed restaurant, amid the coronavirus disease (COVID-19) outbreak, in Madrid, Spain, July 31, 2020. REUTERS/Javier Barbancho 2/2

By Belén Carreño and Inti Landauro

MADRID (Reuters) - The pace of Spain's economic recovery from the coronavirus crisis in the second quarter was less than half the initial estimate, official data showed on Thursday, jeopardising upbeat full-year forecasts of a return to pre-pandemic output levels.

In an unprecedentedly sharp revision, the National Statistics Institute (INE) said the economy grew just 1.1% in the April-June period from the previous quarter, down from a flash estimate of 2.8% released in late July. It also revised the scale of the first-quarter contraction to 0.6% from 0.4%.

Until this revision, the Spanish economy had been recording one of the fastest rebounds among developed countries, after a historic 10.8% slump in 2020.

Just two days ago, the OECD ranked Spain as the fourth-fastest growing economy in the world this year and the Bank of Spain revised higher its full-year growth forecast for 2021 to 6.3%, describing the July estimate for second-quarter expansion as "a positive and big surprise".

Economy Minister Nadia Calvino earlier this week announced an expected return to pre-pandemic GDP levels by the end of 2021..

With today's data, such calculations will probably change.

The INE said its downward revision was prompted by final data on sales, from both large and small companies in the service and manufacturing industries, as well as private consumption.


It now believes the segments most exposed to consumption, such as retail, restaurants and transport, had shrunk 0.4%, while it had previously estimated 5.5% growth.

"It is a period of large and rapid changes... It poses an unprecedented statistical challenge," the INE added.

The INE also revised year-on-year growth for the second quarter to 17.8% from 19.8%. In the same quarter of 2020, Spain was under a strict lockdown.

"The downward revision of GDP growth... will significantly delay the recovery of the Spanish economy after the COVID-19 crisis and implies a downward bias in our growth scenario for 2021", said Rafael Domenech, chief economist at BBVA (MC:BBVA).

The Bank of Spain, asked if it would now review its outlook, said it would take the new data into account for future forecasts, adding the INE's July estimate had surprised on the upside.

Skyrocketing electricity prices are also pressuring Spanish household and business spending, the Funcas think-tank said, posing further challenges to Spain's growth.

Spain's quarterly growth revised sharply lower, 2021 outlook at risk

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
perplexed76 .
perplexed76 . Sep 23, 2021 4:13AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
wonderful news! good reason to make a new rally
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email