Spain enters recession as GDP plummets 18.5%
Spain posted a record fall in GDP in the second quarter, plunging a worse-than-expected 18.5% and sending the country into a deep recession, data from the National Statistics Institute showed on Friday.
Analysts had forecast a 16.6% fall. The major contraction reflected a strict lockdown at the height of the coronavirus pandemic and followed a 5.2% drop in the first quarter.
A slump in private spending and investment along with falling exports were the main drivers for the fall, the institute said.
Spain had been growing for 24 quarters in a row until the first quarter, and was beginning to fully recover from the 2008 financial crisis.
The government has forecast a contraction of 9.2% in 2020, surpassing the fall during Spain’s 2008-2013 financial crisis, and has said it expects 6.8% growth in 2021.
Spain joined France in reporting a heavy fall in GDP. The French economy contracted by 13.8% in the second quarter.