Spain sees recovery in spending, 4Q growth

Spain sees recovery in spending, 4Q growth
Published: 03 January 2011

Spain’s central bank and prime minister have both made cautiously optimistic statements on the country’s ailing economy, with the latter saying he expects growth in the fourth quarter. In its closely-watched monthly economic report, the Bank of Spain said that private consumption, which tumbled as the local property market crashed in 2008, showed "a less unfavorable evolution" than previously in October and November, and is ticking higher compared with the third quarter – a sign that government forecasts for modest 1.3% economic growth next year may not be far off the target.

Meanwhile, Spanish prime minister Jose Luis Rodriguez Zapatero told a news conference that he will press ahead with a series of reforms seeking to lift Spain’s low productivity levels. With polls showing Zapatero’s Socialists would likely suffer a historic defeat if elections were held now, the embattled prime minister said Spain is on track to meet its budget deficit target for the year, of 9.3% of gross domestic product.

On the other hand, plenty of dark clouds remain--INE said consumer confidence in the construction sector dropped to its lowest point in this economic cycle in November. Cement consumption was down 24% on the year in November, it added.