Country Economic Forecasts > Spain

GDP growth in Q3 was confirmed at 0.8% on the quarter and 3.4% on the year. In line with our expectations, growth was driven by a robust expansion in domestic demand. But solid growth has resulted in a strong rise in imports, leading net exports to post a small negative contribution to growth. According to our GDP model, we expect the Spanish economy to maintain its current momentum and we forecast 0.8% quarterly growth in Q4 as well.Growth continues to be broad-based, led by particularly strong private consumption as households continue to benefit from favourable factors: strong job creation, positive sentiment and a renewed weakness in energy prices that is leading to an increase in real disposable income. Furthermore, exports continue to show resilience in the face of increasing global economic headwinds.Spain will hold national elections on 20 December that are likely to shift the current political landscape. Currently, no party is expected to be able to achieve a majority in parliament, so alliances will be required. Although a fragmented parliament increases the risk of policy inaction, our central scenario does not foresee political risk derailing the recovery; we expect GDP growth of 3.2% this year and 2.9% in 2016.