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IMF revises up Spain's 2014 growth forecast

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IMF revises up Spain's 2014 growth forecast
Christine Lagarde, Managing Director of the International Monetary Fund (IMF). File photo: Petras Malukas
10:01 CET+01:00
The International Monetary Fund has revised up its 2014 growth forecast for Spain to 0.6 percent, or more than triple the figure it forecast in October last year, but still very modest.

The revised IMF figure is some way up from the 0.2 percent it had previously forecast for Spain in 2014, but remains below the Spanish Government's official prediction of 0.7 percent for this year.

The IMF also predicts Spain's growth rate will be lower than all the other major European economies except for Italy, also expected to experience 0.6 percent growth.

The IMF's figure for Spain does, however, outstrip the 0.5 percent forecast by Brussels in November.

Savings bank association FUNCAS, meanwhile is predicting 0.9 percent growth in 2014, while analysts JP Morgan have put this figure at 1 percent. 

The euro area is turning the corner from recession to recovery," said the IMF in a statement on Tuesday.

"Growth is projected to strengthen to 1 percent in 2014 and 1.4 percent in 2015, but the recovery will be uneven." 

"High debt, both  public and private, and financial fragmentation will  hold back domestic demand, while exports should  further contribute to growth," said the group
 
Unemployment remains at a very high 26.7 percent in Spain and the IMF have predicted this figure will stay above 25 percent for the next five years.

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