Swings and roundabouts during the latest panel organized by The Spanish Savings Banks Foundation (Funcas), published several days ago. While this year’s growth forecasts for the Spanish economy continue to improve, increasing by two tenths to 11.8%, next year’s forecasts have worsened by eight tenths to 6.5%. “This cut is due to a hangover effect from the relapse expected in the fourth quarter of this year, rather than pointing to a worsening outlook for next year,” Funcas highlighted in a statement.
The Spanish Economic Forecast Panel is a survey conducted by Funcas among 20 analytics services. Based on the responses, “consensus” forecasts are produced bimonthly using the arithmetic mean of the 20 individual forecasts. For several months, MAPFRE Economics, MAPFRE’s research service, has been included in this Panel. On this occasion, they expect an 11.8% fall in Spain’s GDP; that is, exactly the same as the average. However, MAPFRE’s economists are somewhat more optimistic for next year, projecting a 6.7% rebound. At the start of January, MAPFRE Economics will present its new Economic and Industry Outlook in which it will update its projections both for the Spanish economy and for the main economies of the world.
With regard to the unemployment rate, the Funcas panel expects the annual average to be 16.9% this year and 17.5% in 2021.This represents a decrease of 0.9 and 0.3 points respectively compared to the previous Panel, although the projected GDP growth for 2021 has been cut by eight tenths. MAPFRE Economics, for its part, projects 17.8% and 18.3% respectively.
Funcas analysts note that since May, more than 50% of the total employment drop in March and April has now been recovered. Adding to this is the fact that more than 2.7 million workers have been lifted out of the Spanish Government’s ERTE furlough scheme. The scheme went from almost 3.4 million users at the end of April to around 600,000 at the end of October.
The estimated average annual inflation rate has fallen by one tenth for 2020 and 2021, to -0.3% and 0.9% respectively. This puts the year-on-year rates at -0.4% for December 2020 and 1.3% for December 2021. MAPFRE Economics’ own analysis projects -0.2% and 1% for each respective fiscal year.
Finally, panelists have projected that the public deficit will increase by one-tenth this year to 12.4% of GDP and by nine tenths to 8.3% next year. MAPFRE Economics also predicts 12.4% for this year, but their projection for 2021 is slightly below the average at 7.6%.