Brussels Warning: Spain Will Have Inflation Of 8.1% In 2022 And Will Grow Less In 2023

spain savings rate

The European Commission has not corrected its forecasts with respect to May: growth remains at 4%, close to the Government’s April forecast of 4.3%. The blow comes in 2023, with one of the biggest downward revisions in Europe, of 1.3 percentage points: growth of 2.1%, after the Commission itself estimated months ago that it would be 3.4%. For this period, the government had estimated 3.5% growth three months ago. The economic slowdown is in line with what is happening in Europe as a whole, since in no country are forecasts improving. Specifically, the eurozone economy will grow by 2.6% in 2022 and 1.4% in 2023.

“In Spain”, according to Commissioner Gentiloni, “economic activity this year will be underpinned by the return of tourism to pre-pandemic levels and faster implementation of investments under the Recovery and Resilience Plan. Towards the end of the year and in 2023, economic activity is expected to slow, as households adjust their consumption decisions to economic uncertainty and rising prices”.

The price rises mentioned by Gentiloni are another piece of bad news for Spain. The European Commission’s new revision predicts average inflation of 8.1% until the end of the year , and it will not be until 2023 that prices will stabilise a little more, with an average inflation rate of 3.4%. In the euro zone it will reach 7.6% in 2022 and 4% in 2023, but in addition, the third quarter of the year is expected to set a new all-time high of 8.4%. “Despite a weakening economy, inflationary pressures remain strong, but after reaching a record level there will be a decline,” Gentiloni stressed.

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