The Savings Bank Foundation (Funcas) raised by half a point its estimate of growth in Gross Domestic Product (GDP) The Spanish this year 2024 up to 3%, while it forecasts an economic development rate of 2.1% in 2025, compared to 1.8% in the previous forecast.
The General Director of Funcas, Carlos Ocaña, and the Director of International Economic and Economic Affairs of Funcas, Raymond Torres, presented the economic and fiscal forecasts for Spain 2024-2025 during a press conference.
Behind this strong upward revision of the forecasts for the year 2024 are hidden factors such as a greater contribution from domestic demand, notably public consumption, as well as, to a lesser extent, better dynamism in private consumption and external demand.
Regarding developments in 2025, Raymond Torres explained that the prospect of a recovery of the European economy and the drop in interest rates suggest an improvement in GDP forecasts in 2025, of 1.8% from the July projection to the current 2.1%.
Even if activity indicators remain in expansive territory, Ocaña warned that it is “very important” which improve certain components of the economy’s growth, such as business investment and private consumption.
Inflation
“It is necessary to stimulate investments in equipment and housing, and this requires, beyond a reasonable tax treatment, to be firm and better regulate,” stressed the general director of Funcas.
Regarding inflation, Funcas’ estimate is that The annual average CPI for this year will be 2.7% and the consumption deflator rate will record 3.2%. By 2025, it is estimated that the private consumption deflator will slow to 2.4% and the CPI will be around 1.8% on annual average.
The economic situation and Funcas’ forecasts are consistent with a further decline in the unemployment rate, which is expected to gradually fall to 10.5% by the end of next year. “This also incorporates an additional benefit linked to the entry of foreign labor,” Torres explained.
