Spain: GDP growth stable in Q2
GDP growth was steady at 0.8% on a seasonally adjusted quarter-on-quarter basis in Q2. The reading surprised markets on the upside. On a seasonally adjusted year-on-year basis, economic growth edged up to 2.9% in Q2, following the previous period’s 2.6% increase and marking the best result since Q1 2023.
Household spending growth fell to 0.3% in Q2 (Q1: +0.4% s.a. qoq), marking the joint-weakest expansion since Q4 2022. Moreover, fixed investment growth waned to 0.9% in Q2, following a 2.6% expansion in the previous quarter. That said, government consumption bounced back, growing 0.2% in Q2 (Q1: -0.6% s.a. qoq). All in all, domestic demand contributed 0.3 points to growth, matching Q1’s outturn.
On the external front, exports of goods and services increased 1.2% on a seasonally adjusted quarterly basis in the second quarter, which was below the first quarter’s 3.3% expansion. Meanwhile, imports of goods and services swung into contraction, declining 0.2% in Q2 (Q1: +2.2% s.a. qoq). Consequently, external demand contributed 0.5 points to growth, the same as in Q1, albeit with import weakness playing a significant role in Q2.
Following a stellar H1, our panelists expect the economy to lose some steam in Q3 as public spending growth softens. Nonetheless, growth is set to continue outpacing the Euro area average throughout the rest of the year, and our panelists are likely to upgrade their GDP growth projections for 2024 as a whole in light of Q2’s reading.