What the Bank of Spain also said but you didn’t hear

costa del sol spain

According to the latest update from the Bank of Spain, the country's economy was contracting “at a significant rate” during the third quarter of this year.

This lament has made it to most headlines as a hard fact, but many analysts in Madrid took their time to clarify the statement in Thursday's investor notes. The central bank had stressed as well that “data in this quarter still is incomplete and includes few quantitative indicators to forecast the impact of the September VAT rise,” Link analysts said.

Alberto Vigil, analyst at Barclays, collected today some of the good, optimistic and so-so details that are to be found in the Bank of Spain's report and offers a kinder picture of the Spanish economy.

For instance, the real retail trading activity rate, seasonally adjusted, experienced a minor fall month on month in July. In August, vehicle registration rose notably. Production of equipment increased by 1.4 percent in July and social security average affiliation rate behaved in a very stable manner during July and August.

Good exports rose by 5.3 percent year on year, after a 2.7 percent recorded in the previous quarter. Imports grew by 4 percent, while they have fallen by 7 percent in the second quarter. The Spanish trade deficit is now 21 percent lower than last year January to July.

What about tourism? Non-resident visits rose by 5 percent in average in July and August year on year. There has been 4.3 percent more hotel room hiring this quarter and 8.9 percent more spending in July year on year.

Spain's balance of payments showed a deficit in the first half of the year of €14.7 billion, which is one third of what it was in 2011, after a €0.45 surplus in June 2012.

And the manufacturing index PMI increased in July and August, as it did industrial production's, seasonally adjusted, in July by 0.2 percent month on month.

There you have, some half full glass.


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The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.