Bank of Spain raises 2015 economic growth forecast to 2.8 percent
By Bloomberg
The Bank of Spain said the economy will grow faster this year than previously forecast as lower fuel costs and a weaker euro help drive expansion.
Gross domestic product will rise 2.8 percent this year, more than the 2 percent projected in December, and 2.7 percent in 2016, the central bank said in its monthly economic bulletin published Thursday. The economy will grow 0.8 percent this quarter. Unemployment will fall to 20.5 percent next year from 22.5 percent.
The impact of a weaker euro, lower oil prices and improved financing conditions as the European Central Bank starts its stimulus program are the backdrop to the improving growth scenario, the Bank of Spain said. Its estimate exceeds the 2.4 percent GDP forecast of the government of Prime Minister Mariano Rajoy, who is betting on a buoyant economy to help his chances in upcoming general elections.
Inflation expectations depend greatly on the behavior of oil prices, the Bank of Spain said. Under its “central scenario,” consumer prices may fall 0.2 percent this year and rise more than 1 percent in 2016.