Bank of Spain to revise down 2021 GDP forecasts

The central bank governor Pablo Hernandez de Cos said that the Bank of Spain will revise down its latest economic forecasts for 2021. This is after the Spanish statistics institute downgraded its growth reading for the second quarter. on Tuesday. De Cos reiterated that he anticipates a gradual normalization of activity in the upcoming months.  Spain’s second-quarter gross domestic growth was revised to 1.1% as per the official data.

The Bank of Spain before two days to this, had raised its estimate for full-year growth forecast for 2021 to 6.3%. De Cos said that these forecasts will have to be updated once the implications of the profound revision made by the statistics institute INE. The INE’s downward adjustments were prompted by final data on sales. This is from both large and small companies, in the service and manufacturing industries, along with some private consumption.

The segments most exposed to consumption, such as retail, restaurants and transport, had shrunk 0.4%. The Spanish economy is one of the fastest rebounds among developed countries, after a 10.8% slump in 2020, from its experience.