Spain’s second-quarter GDP growth of 1.1% tops estimates

(Reuters) – Spain’s second-quarter economy expanded 1.1% over the previous three months to top growth estimates on robust overseas demand for the country’s goods and services, preliminary data showed on Friday.

Analysts polled by Reuters had expected gross domestic product to grow 0.4% quarter on quarter. On an annual basis output expanded by 6.3%, compared with a Reuters poll of 5.5%.

A foreign demand increase offset a slowdown of the domestic demand, INE said. Services, which account for about half of the country’s GDP, expanded faster than industry and construction thanks to the post-pandemic recovery in tourism and as all restrictions on public events were lifted.

On Tuesday, the Spanish government maintained its economic growth forecast for 2022 at 4.3%, citing a strong tourism season, but lowered the growth target for 2023 to 2.7%, as the war in Ukraine is likely to keep weighing on European economies.

The International Monetary Fund, however, has lowered its Spanish GDP forecast for the year to 4%.

The Spanish economy had grown 0.2% in the first quarter of 2022, slowing from a 2.2% growth rate in the last three months of 2021.

(Reporting by Mariana Ferreira Azevedo; editing by Inti Landauro and Vinay Dwivedi)