Spain’s economy showed stronger momentum than initially projected in the first half of the year, according to Quarterly National Accounts data published by the National Statistics Institute. GDP expanded by 0.5 percent in the second quarter, a figure that beat expectations by one tenth, following a 0.6 percent rise in the first quarter, also above forecasts. The year-on-year pace reached 2.2 percent, dipping from 4.2 percent in the prior quarter and signaling that a softer external sector contributed to the slower growth in the period. These numbers align with a gradual but resilient recovery narrative, even as external headwinds persist (INE, quarterly accounts).
In the second quarter, growth was propelled by domestic demand, which helped lift annual expansion to 2.3 percent. Household consumption remained a key driver, supported by improving investment activity, particularly in construction. By contrast, external trade contributions turned negative, with exports and imports recording declines of 0.8 percent and 0.4 percent respectively, reversing the gains seen between January and March when exports rose 9.6 percent and imports 1.9 percent (INE, quarterly data).
This quarterly assessment corroborates the earlier review that traced performance back to the 2020–2022 period and points to a full-year 2022 growth projection of 5.8 percent, a provisional figure that exceeds the 5.5 percent forecast made in January and March 2023. The breakdown shows quarterly growth of 0.3 percent in the first three months of 2022, versus a projected -0.6 percent, followed by 2.5 percent growth between April and June, and 0.5 percent in the final two quarters. These patterns reflect a recovery trajectory that has been revised over time as new data accumulated (INE, 2022–2023 revisions).
The revisions suggest that recovery unfolded differently from earlier narratives, particularly with respect to when the impact of the pandemic and subsequent shocks would fade. The latest data emphasize that the improvement in activity occurred even as the economy faced an uneven path through the third quarter of 2022 and beyond, rather than a straightforward return to pre-crisis trends in the first quarter of the current year. The narrative surrounding Spain’s place in the eurozone’s recovery remains nuanced; growth in the latter half of 2021 outpaced earlier expectations, yet overall performance still lagged behind some European peers at certain moments. The quarterly adjustments contribute to a clearer picture of Spain as one of the larger, faster-growing economies within Europe, even as other member states maintained momentum into the later part of the year (INE, quarterly review).
INE attributes the shifts to a high level of uncertainty that has persisted since the pandemic shock and the geopolitical disruptions triggered by the invasion of Ukraine, with ongoing policy responses affecting inflation, rates, and domestic demand. The agency notes that the current analysis is especially relevant given the unusual timing and magnitude of the shocks, and it underscores the role of employment dynamics as an important indicator. Employment expanded with around 576,000 more full-time positions added, and year-on-year productivity increased by 1.2 percent. This trend reflects a healthier labor market contributing to household spending and overall demand, even as efficiency gains per hour worked helped sustain price-agnostic growth (INE, quarterly review).
The 2.2 percent annual growth rate in the second quarter signals a more moderate pace of expansion compared with the strongest periods of the recovery, but it supports Spain’s standing as one of the larger economies showing sustained growth among major European economies since the first quarter of 2021. The data also indicate that national demand’s contribution to year-over-year GDP growth rose to 2.3 percentage points, up from 1.5 points in July, while household consumption contributed 2.2 percent to growth despite weaker external demand (negative 0.1 percentage points net). This combination highlights how domestic factors remain the backbone of activity, even as external trade faced headwinds (INE, quarterly review).
During the three-month development phase, household consumption managed to hold steady despite tensions, posting 0.3 percent growth in the first quarter and 0.9 percent in the second quarter. These outcomes contrasted with more pessimistic forecasts of -1.4 percent for inflation and rising interest rates in the summer, underscoring the resilience of domestic demand. Public expenditure also showed resilience, rising to 1.6 percent in the second quarter after a modest 0.5 percent decline in the first. Housing investment performed strongly, posting 1.6 percent growth in the second quarter and 3.6 percent in the preceding period, while earlier advances had been more mixed. The overall pattern reinforces a narrative of gradual stabilization, supported by targeted investments and a consumer base that continued to spend across key sectors (INE, quarterly data).