The recovery in Spain’s property market is good news for the country’s banks as it will provide a boost for the economy as a whole, while helping reduce the “toxic” real estate assets on the lenders’ balance sheets, says the rating agency.
Cheaper oil and electricity pushed prices down by 0.3% in August compared to the previous month. In year-on-year terms, prices dropped by 5 basis points or 0.4%.
BBVA Research maintains its assessment on the recovery of activity in 2015, with expected growth of 3.2%, slowing to 2.7% in 2016.
The proximity of the regional elections in Catalonia, due to take place at the end of this month, combined with the uncertainty over the results of this process and its consequences, is leading foreign and many domestic investors to reduce their exposure to the Spanish stock market.
Consumer confidence in Spain rose to a record high of 105.9 in August from 105.6 in July, due to the improved evaluation of the situation affecting households and the labour market.
By Félix Lores Juberías and Ignacio San Martín at BBVA Research | Housing sales, which grew by approximately 8%, were shored up by increased lending, the upturn in employment and better consumer confidence.
Household debt declined 1.2% to 733.24 billion euros in July compared to June, reaching August 2006 levels, according to the Bank of Spain.
As usually happens in the month of August, unemployment in Spain rose due to the end of the summer season. The jobless rate climbed by 21,679 people and social security affiliations declined by 134,289. But the unemployment rate decreased by 8% on a year-on-year basis.
Operating conditions continued to improve in August, according to the latest Markit PMI survey. Output grew to a 3-month high, yet new orders rose at levels of 2013.
Economic sentiment improves in Spain thanks to industry, services and construction.