Bank of Spain to Revise Economic Growth Forecasts Upward
The Governor of the Bank of Spain, José Luis Escrivá, recently announced that the institution will raise its economic growth forecasts for 2025 and 2026 in its upcoming quarterly report. This adjustment reflects the positive performance seen in recent economic data.
Background of the Upward Revision
In an interview, Escrivá pointed out that the latest data confirm the resilience and dynamism of the Spanish economy. Although 2025 is nearing its end with growth figures largely set, leading to a minor revision, the forecast for 2026 has greater potential for an upward adjustment. The report, to be released on December 23, follows a similar move by the European Central Bank, which recently raised its growth forecast for the Eurozone.
Previously, in its September report, the Bank of Spain had revised its 2025 GDP growth forecast upward to 2.6%, while maintaining projections of 1.8% for 2026 and 1.7% for 2027. The upcoming revision will further reflect the positive developments in the economy.
Multiple Organizations Optimistic About Spanish Growth
Several international organizations have also recently upgraded their outlook for the Spanish economy. The European Commission, the International Monetary Fund (IMF), and the Organisation for Economic Co-operation and Development (OECD) have adjusted their 2025 growth forecasts for Spain to around 2.9%. This is attributed to strong domestic demand, sustained employment growth, and an influx of immigrants supporting the labor market.
Spain’s economy stands out within the Eurozone, with clear internal demand drivers. Private consumption and investment have become the main engines of growth, the job market remains dynamic, and the unemployment rate is expected to decline further.
Employment and Demand Underpin Growth
Spain’s labor market remains robust, with significant contributions from immigration driving population and labor force growth. Private consumption is benefiting from rising incomes and improved employment. In the investment sector, residential construction and equipment investment are expected to accelerate, influenced by the implementation of the European recovery funds.
Despite global uncertainties, the Spanish economy has shown strong resilience. The European Central Bank’s decision to keep interest rates stable, while raising its 2026 growth and inflation forecasts for the Eurozone, also indirectly supports Spain’s outlook.
