Experts are forecasting an unemployment rate of 15% in 2018, when it is estimated that Spain’s economy will have reached its GDP growth potential, so that figure could represent its structural jobless rate. This decline in the unemployment rate, the starting point of which was 26% at the lowest point in the economic cycle, is substantial. But it will still be high compared with other eurozone countries.
Bank of Spain
A new round of mergers amongst Spanish banks could just be round the corner. The Bank of Spain has also added its voice to the market rumours, the “off the record” comments from bank directors and the warnings from international organisations about the sector’s delicate health.
Although the Bank of Spain expects economic growth to slow to 0.8% in the third quarter from 1.0% in the second, international investors are still betting on Spain. Foreign investment outflow fell to 1.5 Bn€ in July compared from 5.5 Bn a year earlier, according to the central bank’s figures.
Bank of Spain’s governor Linde considers the government’s forecasts ‘feasible’ but warns about possible risks.
MADRID | March 27, 2015 | By Francisco López | The Spanish economy is currently growing at cruising speed and looks set to remain at its current altitude in the medium term, with the possibility that growth could exceed 3% this year.
MADRID | March 12, 2015 | By Fernando G. Urbaneja | The exposure of Andorran lender by the US Treasury sounds word of warning to banks concealing the proceeds of organised crime.
MADRID | The Corner | The BdE is working on the possibility of establishing a new reference index known as Euribor Plus. The main characteristic would be the form of calculation, which would only take into account prices (interest rates) for transactions instead of reference prices announced by financial institutions.
MADRID | By The Corner | Deputy Governor of Spanish central bank Fernando Restoy said on Friday that the country’s economy will register year-on-year growth rates near 2% at the end of year 2015, according to their last estimates. However, he suggested that “restoring the pre-crisis welfare levels will still take several years.”
SANTANDER | By Ana Fuentes | European Commission President José Manuel Durao Barroso chose his last days in the job to dot the i’s and cross the t’s. Surprising many by his candor, he directly accused the Bank of Spain of making “important mistakes” supervising the financial sector. “It was not the EU nor Ms Merkel who originated the crisis,” he said.
MADRID | By Carlos Díaz Güell | The Spanish central lender ordered the national bad bank Sareb’s to assess the 107,000 toxic real estate assets again and 215,000 collaterals on loans that it purchased to the intervened financial entities. This new due dilligence ruined the work of 24 companies such as the property firm Richard Ellis, Clifford Chance’s lawyers and the consulting group KPMG.