Spain’s economy grew by 3.1% in the second quarter of the year compared to the same period in 2024 and 0.8% quarter-on-quarter, according to the Spanish National Statistics Institute (INE).
In the first quarter of the year, Spain’s Gross Domestic Product (GDP) had increased by 3.2% year-on-year and 0.6% quarter-on-quarter.
The growth in the second quarter (April to June) was driven by domestic demand, particularly investment and consumption, mostly household consumption, which contributed 3.5 percentage points to the GDP increase year-on-year and 0.8 points to the quarter-on-quarter rise.
Meanwhile, external demand (exports and imports) had a negative contribution of 0.5 percentage points compared to the same period in 2024 and had zero impact on quarter-on-quarter growth.
The Spanish economy grew by 3.5% in 2024, according to an updated INE estimate released last week, improving the previous calculation by three-tenths.
Additionally, last week, both the Spanish Government and the Bank of Spain raised their forecasts for the country’s economic growth this year to 2.7% and 2.6%, respectively.
The government had previously forecasted a GDP increase of 2.6% for 2025, while the latest estimate from the Bank of Spain was a growth of 2.4%.
“Despite the complex international context in which we operate, the Spanish economy continues to show clear signs of strength both in the short and medium term,” said Economy Minister Carlos Cuerpo at a press conference in Madrid on September 16, where he presented the new forecasts and highlighted that “in 2024, Spain was the fastest-growing advanced economy globally.”
The government expects the Spanish economy to grow by 2.2% in 2026 and 2.1% in both 2027 and 2028, with a positive impact on the labor market that should reduce the country’s unemployment rate to 8.7% by 2028.
Spain currently has the highest unemployment rate in the European Union, with the government estimating it will be 10.3% by the end of this year.
Throughout the forecast period, domestic demand (consumption and investment) will be the main driver of economic growth, especially household consumption, while the contribution of external demand (exports and imports) will remain negative until 2028, according to the government.
As for the Bank of Spain, it has improved its 2025 GDP growth forecast for Spain by two-tenths to 2.6%, maintaining the estimate of a 1.8% increase in 2026 and 1.7% in 2027.
The central bank’s new estimates also rely on the dynamism of domestic demand, particularly private consumption.
The International Monetary Fund (IMF) forecasts a growth rate of 2.5% for the Spanish economy this year, followed by a 1.8% increase in 2026, based on estimates released in July.
The European Commission estimates that Spain’s GDP will grow by 2.6% this year, according to the latest forecasts from Brussels released in May.
