Spain | Is now the time?

The Spanish economy rebounded significantly during the third quarter of last year. However, it then stagnated at the end of 2020 and may even have fallen by 0.9% in the first quarter of 2021. At this moment in time, the evidence suggests that the recovery is back under way.

Key points

• Key points:
• The data from March suggests that the economy has seen an upturn, linked to improved health indicators and the easing of restrictions to stop the spread of coronavirus.
• The number of wage earners on furlough dropped to 113,900, while spending on BBVA credit cards increased 13% compared to the same month in 2019 (what we might consider a 'normal' year).
• Furthermore, increased certainty surrounding the health situation and the relaxation of social distancing could unlock the savings accumulated by households during the crisis.
• Another factor to consider is the major change in US fiscal policy, which should add around 0.2 pp to GDP in 2021 and 0.8 pp in 2022. The third and final push would be an increase in public spending.
• The problem, however, is that there are still significant downside risks. There are still bottlenecks in vaccine supplies, and mistrust of some vaccines is on the rise. In addition, there are doubts about the speed and efficiency of delivery of the announced resources to companies.

Authors

Geographies

Topics

Tags