This Bank of Spain He lowered his estimate a little. growth until 2023, up to 1.3% (one-tenth below the October estimate and eight-tenths below the Government estimate of 2.1%). In addition, the body corrected significantly downward this time your guess inflation my love for the next year. The Bank of Spain, in new forecasts for the Spanish economy this Tuesday, forecasts average inflation to remain at 4.9% in 2023; that’s seven-tenths less than the 5.6% predicted in October. And the reason for such a surprising turnaround is that in their new calculations, the Government has taken as a central hypothesis that it will extend through 2023. tax relief on electricity and natural gas and that it would simply put an end to the general bonus of 20 cents per liter of fuel.
Neither of these two hypotheses is yet true. Head of government Pedro Sánchez announced that the decision will be made next week, a few days before the end of the year. However, the Bank of Spain assumes, under the calculation hypotheses, that the Government will be extended over the next year until 31 December 2023. Reducing VAT to 5% on electricity and gasreduction to 0.5% excise duty on electricity and suspending the electricity generation value tax (IVPEE) and freezing the price of butane. These measures will have a four-tenth impact on the deficit (approximately 5,200 million more deficits). The Bank of Spain is also undertaking a possible extension until 31 December 2023. price reduction in metro and bus transportation passesBesides the 2% limit on revaluation of rents, and a temporary increase of 15% in non-contributory benefits.
In addition, the Bank of Spain includes approved measures such as its extension until 31 December 2023, unlike the October projections, in its calculations. maximum 15% limit increase in raw material prices in the last resort tariff in natural gas and free commuter rail transport cards.
Extension in 2023 and withdrawal in 2024
Extending all these measures helps the Bank of Spain’s average inflation forecast for 2023 come in at 4.9%, seven-tenths below the agency’s forecast in October (5.6%). Extending the bonus 20 cents per liter of fuel until the end of 2023 would subtract six-tenths more from inflation According to the estimates of the Bank of Spain (up to 4.3%). However, this does not appear to be the Government’s intention, as can be seen from the statements of Vice President Nadia Calviño.
On the other hand, the scenario of expanding the measures that the Bank of Spain hypothesized in the forecasts released this Tuesday Adds four-tenths to GDP growth It is expected to go up to 1.3% for 2023, otherwise it will be reduced to 0.9%.
Expanding anti-crisis measures, as envisaged by the Bank of Spain, will make it possible to maintain some of the economic activity and bring inflation under control. In contrast, the economic impact of the complete withdrawal of aid measures moving to 2024, a year in which the growth forecast was cut by two-tenths to 2.7% and with an average inflation of 3.6%, almost double what the Bank of Spain had forecast in October (1.9%). in a nutshellIn this estimation scheme, the effect of the withdrawal of measures taken by the Government against the energy crisis is transferred from 2023 to 2024.
forecast chain to 2025
Bank of Spain merges for the first time year 2025 in your forecast horizon. It forecasts GDP growth for this year at 2.1% (in the context of what it sees as potential growth of the Spanish economy) and average inflation at 1.8%.
In summary, the new Banco de España forecasts include: growth rates 4.6% of GDP in 2022; 1.3% in 2023; 2.7% in 2024 and 2.1% in 2025. Compared to previous projections, it increased by one-tenth (from 4.5%), corresponding to 2022, compared to October; Decreased by one-tenth (from the previous 1.4%) and two-tenths of 2024 (from the previous 2.9%).
new chain average inflation forecasts It includes 8.4% for 2022 (three-tenths less than the October forecast); 4.9% (seven-tenths less) for 2023; 3.6% for 2024 (1.7 points more than October) and 1.8% for 2025.
The growth ranking forecast for Spain is more positive than predicted by the European Central Bank. eurozone (3.4%; 0.5%; 1.9% and 1.8%). The inflation rate forecast for 2022 is the same for Spain and the euro area; Until 2023 it will be lower in the case of Spain, while in 2024 it will be slightly lower (3.4%) for the eurozone. If forecasts are met, inflation in Spain (1.8%) will be half a point lower than that of the euro area (2.3%) in 2025
No recession in sight
The Spanish economy appears to be avoiding a technical recession, according to the plan the Bank of Spain presented this Tuesday. governing body Pablo Hernandez de Cos guesses he’s in fourth quarter of 2022 (shown as the weakest point), although the Spanish economy will only grow by 0.1%, it can continue to grow.
The slowdown in activity is evident (growth of 1.5% in the second quarter of 2022) and the Bank of Spain estimates that “weakness in activity will continue to be significant in the US”. first quarter of 2023“, a period in which a similar growth (about 0.1%) to the fourth period of 2022 is predicted. In this way, the Spanish economy would have managed to get out of the crisis. technical recession (Two consecutive quarters in GDP with negative rates). However, in a scenario where there is as much volatility and uncertainty as the current scenario, it would be rash to ignore anything, warns the Bank of Spain’s Managing Director of Economy. Angel Gavilan.
However, I hope second quarter of next year Growth will “gradually regain strength” as household incomes (and consumption) recover, the external sector develops, and investment projects linked to European funds come into play. Next Generation EU. As a result, it won’t be until late 2023 or early 2024 that the Spanish economy returns to pre-pandemic levels.