The evolution of deficits will worsen the Spanish economy

Gross domestic product

The Financial Group predicts that Spain will enter a “slow growth spiral”.

• 
  Benjamin Santamaria
  @benjef
• Economist, Researcher, Lecturer and Master of Education. Economics teacher at OKDIARIO and “The Economy through time” teacher at the Juan de Mariana Institute
• 
  

The The Spanish Economy is on the brink of regression due to the evolution of Public deficitWeight State Expenditure It contains Gross domestic product (GDP) and outlook employment, according to Becca Financial Group. Furthermore, the company reveals that the upward revision of growth forecasts has occurred not only in Spain, but in all countries of the world due to the confidence of economists and markets.

Beka cautions that not all companies’ data is predictive shortage A fall of over 3%. Actually, his own Bank of Spain One of the organizations that brought these perspectives to light.

And the financial group explains that markets are showing overconfidence: “Based on what the stock market is discounting and what we’re seeing in the economic data, it looks like we’ve never been better.”

It is this level of investors that drives forecasts upwards, and is not exclusive to Spain. Government of Pedro SánchezBut common across the globe: “What we’re seeing now is an upward revision of growth prospects. America, which goes up to levels of 3.4%. But it’s not just an upwardly revised country. If you look at what the opportunities are Global development Without America, they are improving a lot.

“I mean, the world is looking at developing countries European countries. We can see it in the progress of Hope of Europe, consumers are beginning to say they see the situation better. As if this is not enough, we see how the opportunities are Enter a recession It has now gone from last year’s high of 60% to current levels of 30% within a year in the US,” the company says.

In short, the manager’s talk is that management is responsible for its own development Economic perspective It does not take into account the global context and, in particular, the European context in the same situation.

The future of the Spanish economy

This belief, according to Becca, is not very reasonable. Something that is going to affect Spain in a special way: “We’re going to see a little bit Low growth data In Spain. Last year we saw 0.6% growth in the last quarter. In this first quarter, we saw an increase of 0.7%. What we believe, however, is that Spain’s prospects, despite an improvement in expectations at the supranational level, will be around 2.1% growth. Bad start».

Therefore, the Spanish economy is not going through a favorable moment as the executive assumes, but it may be on the edge. Slow down Considerable “The recent speech of the Bank of Spain is positive, but the situation with related problems is starting to be questioned Employment generationOn the Evolution of Public Deficit, Contribution Public expenditure For development…”, warns the group.

“Consumption will weaken, companies will create fewer jobs, there will be more defaults, and finally, the economy will enter a period of low growth,” Becka warns.

“Cycles die because there are events that kill them that we still think about Interest rates, more than we’ve seen in recent years, should kill the market. We, when we meet in the investment group, try to balance the positive and negative elements of the economy. Well, what we think is that higher interest rates will last longer Consumption weakensFirms create less employment, there are More defaults And, finally, the economy enters a Low growth spiral» Newspaper Becca.

Thus, the confidence of the markets and the confidence maintained by the government may be disappointed in the coming months. The finance team sees alarming signs Cycle change This will come into effect in the coming months. If true, the recession will hit Spain particularly hard.