Growth in Spain slowed to 0.3% in the first quarter of 2022 due to a sharp drop in consumption, affected by the escalation of the inflationaccording to a first estimate published this Friday by the National Institute of Statistics (INE).
This figure represents a clear slowdown compared to the growth registered in the last quarter of 2021, when it reached 2.2 percent. The new data is also very far from the forecast of the Bank of Spain, which at the beginning of April had projected a progression of 0.9% of GDP.
For the purposes still present of the covid-19 pandemic on activity “are added, in this first quarter of 2022, those caused by the recent international crisis derived from the Russian invasion of Ukraine“, explains the INE in its statement.
The conflict has generated “very significant distortions of a diverse nature”, especially “on the energy markets” or “the evolution of prices”, adds the note.
Like many European countries, Spain has been facing an escalation in inflation for months, which reached a peak of 9.8% at the end of March, its highest level in 37 years, before falling slightly in April to 8.4%.
This phenomenon has reduced the purchasing power of households, eroded by the rise in energy and food prices: according to the INE, consumption fell by 3.7% in the first three months of the year.
This decline was offset, however, by the good performance of investment, which advanced by 2.4% after registering growth of 3.6% in the fourth quarter, in addition to the rise in exports (+3.4%) .
In its draft budget for 2022, the government of the socialist president Pedro Sánchez had forecast a growth of 7% for this year, after the 5.1% recorded in 2021.
But the Minister of Economy, Nadia Calviñorecognized that this figure will not be reached, and announced a significant drop in the growth target, due to the uncertainties weighing on the world economy.
The government is due to publish its new economic forecasts on Friday as part of the European budgetary stability programme. According to Calviño, Madrid will align itself with the figures of the main economic organizations.
According to Bank of Spain, Spanish growth will be limited to 4.5% this year, 0.9 points below what was initially anticipated by this institution. According to him IMFthe advance should come in at 4.8% instead of the 5.8% forecast previously.