Spain’s economy grows 1 percent in Q2, fastest rate since 2007, before crisis …

30 Jul 2015 | Author: | No comments yet »

Spain Economy Races Ahead in Second Quarter to Pre-Crisis Growth.

MADRID – Spain’s economy expanded by 1 per cent in the second quarter compared with the previous three-month period, its best rate since before the economic crisis began in 2007. Gross domestic product rose 1 percent from the previous quarter and 3.1 percent on an annual basis, the Madrid-based National Statistics Institute said Thursday in a preliminary report. While the report didn’t break down components of GDP, economists see household consumption and domestic demand as the drivers of the Spanish economy, which has now added eight consecutive quarters of increases. With a general election due by year’s end, Prime Minister Mariano Rajoy is courting middle-class voters with a mix of lower taxes and a stronger economy. Earlier this month, the government raised its forecast for annual growth for the second time this year to 3.3 percent, and brought forward a tax reduction initally planned for 2016.

Having pegged his re-election hopes to jobs and growth, Rajoy faces the question whether the recovery is strong enough to secure him a second term in office. Hit by a series of corruption scandals and austerity, his conservative People’s Party has lost more than two million voters since the previous election in 2011, when it secured an overall majority. The PP now risks a fragmented election result that could shut Rajoy out of government if left-wing parties ranging from its traditional Socialists rivals to anti-austerity party Podemos join forces in a coalition government. A poll published by El Pais newspaper on July 26 showed the PP and the Socialists running almost neck-and-neck with 23.1 percent and 23.5 percent of the vote each respectively.

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