Private debt, which is higher than the eurozone average, is also a key problem which Spain has to deal with to enable it to leave the crisis behind.
But Moody’s is forecasting that the Spanish economy will remain relatively healthy over the next 12 months and argues that fiscal reform and income tax reduction will help increase household income.
Funcas, the Spanish savings banks’ economic think tank , raised its 2015 GDP growth forecast to 3.3 %. It expects the unemployment rate to drop to 22.2% in 2015 and to 20.2% in 2016. Nevertheless, it seems pessimistic about the public deficit (3.4% of GDP in 2016, while the government’s target is 2.8%.). Moody’s is forecasting a public deficit of 3.5% of GDP in 2016.