GDP accelerates three tenths to 2.4% and grows 0.7% in the first quarter

The Spanish economy advances three tenths in year-on-year comparison, up to 2.4% and grows 0.7% in the first quarter of the year, the same as in the previous quarter, according to the advance of National Accounting data published today by the National Institute of Statistics (INE).

National demand contributed 2.2 points to the year-on-year GDP growth, while external demand contributed two tenths.

In aggregate, final consumption spending slowed down two tenths compared to the previous quarter, growing 2.6% year-on-year. That of households remained the same, increasing by 2.3%, and that of Public Administrations increased by 3.0%, 1.1 points less than in the previous quarter.

For its part, gross capital formation registered a variation of 1.1%, 1.1 points higher than that of the previous quarter.

Exports of goods and services presented an interannual rate of -1.1%, which was 2.2 points less than in the previous quarter. For their part, imports registered a variation of -1.7%, with a deceleration of 3.3 points compared to the previous quarter.

From the perspective of supply, all major sectors of activity presented positive interannual rates. Thus, the gross value added of industrial branches increased by 2.3%, and within them, the manufacturing industry increased by 3.3%.

The gross added value of Construction grew by 3.6% compared to the same quarter of 2023, that of Services by 2.6% and that of primary branches, by 0.4.

In a quarter-on-quarter comparison, GDP advances 0.7% due to the improvement in external demand (exports and imports), which contributes 0.5 points, and to a lesser extent, internal demand, which contributes 0.2 points.

During the first quarter of the year, household consumption grew by 0.3%, the same as in the previous quarter, while public spending contracted by 1%, showing its first negative quarterly rate since the second quarter of 2022. Both exports of goods and services (2.4%) and imports (1.1%) registered positive rates.

Investment rose 2.6% between January and March after two negative quarters.

By demand aggregates, household final consumption spending grew by 0.3%, while that of Public Administrations fell by 1.0%. For its part, gross capital formation registered a variation of 1.3%.

On the supply side, all major sectors presented positive rates in their added value. Thus, industrial branches grew 1.6% quarter-on-quarter. Within them, the manufacturing industry accelerated one point, up to 2.2%.

The gross added value of Construction increased 2.0% quarter-on-quarter, eight tenths more than in the previous quarter. And that of Services accelerated by one tenth, to 0.3%. The primary branches registered a quarter-on-quarter variation of 2.5%, compared to 5.3% in the previous quarter.

The Minister of Economy, Commerce and Business, Carlos Body, highlights in a statement that the GDP data for the first year of the year confirms the "strong dynamism" of the Spanish economy.

"This growth figure, together with the positive evolution of employment in our foreign sector, confirms the good performance of the Spanish economy in recent quarters, with differential growth with respect to our main partners, and all of this even in a marked environment due to high uncertainty".

The minister emphasizes in a video the increase in exports, emphasizing that all branches of activity had positive behavior, especially the manufacturing industry, which stood at 2.2% this quarter.

The minister also highlights the growth of investment and the contribution of household consumption "driven by gains in purchasing power, since salaries have grown above inflation in this last year."

In short, Body has stressed that the Spanish economy showed strong dynamism during 2023, growing more than five times faster than the euro zone, a pulse that will continue in 2024. "This puts us in an optimal position to continue leading growth among the main European economies in 2024, as predicted by the main forecasting organizations, both national and international", he concluded.