Spain’s economy slowed slightly in the third quarter, as a drop in investment offset a boom in tourism.
Gross domestic product rose 0.3% from the previous three months, according to data published Friday by the INE statistics agency. That’s down from 0.4% in the second quarter but more than the 0.2% median estimate in a Bloomberg survey of analysts.
Spain has been among Europe’s top performers since the pandemic, buoyed by a strong rebound in tourism that’s been helped by unseasonably warm weather. Its figures for 2021 and 2022 were revised up last month — revealing that the economy returned to pre-Covid levels last year, rather than in mid-2023 as previously thought.
Spain has also seen the inflation spike that followed Russia’s invasion of Ukraine recede more quickly than in other parts of the continent — at one point dipping below the European Central Bank’s 2% goal. But tighter monetary policy is threatening to hurt households with floating-rate mortgages, and unfavorable base effects are stoking prices again.
Friday’s data are the first from a major euro-area member, with Germany, France and Italy to report next week, along with the 20-nation currency bloc itself, which is struggling to maintain growth.
The numbers could have implications for Acting Prime Minister Pedro Sanchez, who must decide by year-end whether to extend a series of subsidies — notably on public transport — that were put in place to ease the cost-of-living crisis.
Sanchez’s Socialists are currently in talks with other parties to try to form a government, which he must do by Nov. 27 to avoid a new election.
--With assistance from Ainhoa Goyeneche and Joel Rinneby.
