MADRID (Reuters) – The Spanish economy could grow less this year than the recently forecast 4.5% as rising inflation impacts consumer confidence, Bank of Spain Governor Pablo Hernandez de Cos said on Wednesday.
In April, Spain’s central bank had already lowered its economic growth outlook for this year and next due to the impact of inflation stoked by Russia’s invasion of Ukraine and forecast inflation would soar to 7.5% in 2022.
“New information following the publication of these projections, including lower-than-expected GDP growth in the first quarter, would, in the absence of additional shocks, point to a further downward revision in the expected GDP growth rate for this year as a whole,” De Cos said.
Spain’s growth slowed down sharply to a weaker-than-expected 0.3% in the first quarter from the previous quarter, leading the government to slash its growth outlook for this year to 4.3% from 7%.
(Reporting by Jesús Aguado; additional reporting by Emma Pinedo; editing by Andrei Khalip)
