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The tax authority expects Spain to fall into a technical recession in the first quarter of 2023

An independent body for fiscal responsibility warns that the Spanish economy will enter a technical recession in the first quarter of 2023. This situation occurs because the Public Accounts Audit Authority believes that GDP for the fourth quarter of this year will close in the negative for the year and the first three months of next year. However, the agency is maintaining its growth forecast for next year at 1.5% – six-tenths below the government’s forecast.

“It’s a few tenths,” Airef points out, downplaying the entry of the Spanish economy into this scenario. “The definition of a technical recession is two quarters in a row. Does this mean it’s a recession? We have our doubts,” assured Cristina Herrero, the organization’s president, while presenting a report that Airef must sign in next year’s accounts.

“Gross domestic product growth in the third quarter of the year could be around zero or something positive, but certainly very, very close to stagnation,” explained AIReF economic analysis director Esther Gordo Mora during the presentation. 2023 Public Administration Budget (AAPP) Outline Report.

Looking ahead to the fourth quarter, Gordo explained that AIReF’s first estimates show the economy will contract by 0.2% to 0.3%, although he acknowledged that the deterioration in the rest of Europe is “very intense”. which may lead to an “overestimation” of these estimates. Rates for the first quarter of 2023 will initially be similar to those for the fourth quarter of 2022, although everything will depend on the context.

And it is that the weakening of global growth is generalized, according to AIReF, and successive downward revisions to expected growth in 2023 have been registered, while inflation has been revised upwards.

Source: El Diario





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