Economists are downgrading growth forecasts after the latest Spanish austerity announcements.
The additional fiscal measures will further weigh on Spain’s growth prospects and underline our expectation that the recession in Spain will deepen and continue in 2013,” said Ebrahim Rahbari at Citi.
Edward Hugh, an economist based in Barcelona, said he would not rule out the possibility that Spain’s recession “could spread into 2014 now”. The economy could contract by 2pc this year, 1pc in 2013 and then 0.3pc in 2014, he said.
