The Funcas panel has revised upwards the GDP growth forecast for this year by two tenths, up to 1.5%, as a result of a better-than-expected evolution in recent months. For the first time, in this panel, closed before the current episode of financial instability, projections for next year have been requested. The consensus for 2024 anticipates an acceleration of the economy of six tenths, up to 2.1%. Regarding the quarterly profile, the panelists expect growth of 0.1% in this first quarter and increases of around 0.4% and 0.5% in the next three. The projections are in line with that of other organizations such as the Bank of Spain or the OECD, which have updated their forecasts in recent days with similar advances.
The contribution of national demand will be 1.2 points, one tenth less than the previous forecast, while the foreign sector will add three tenths -compared to the null contribution of the previous Panel-.
The consensus has revised the forecast for growth in public consumption upwards and downwards that of household consumption and investment in all its branches.
Looking to 2024, the contribution of national demand will reach two percentage points. Within this, public consumption will moderate while investment and private consumption will recover dynamism. For its part, the foreign sector will contribute one tenth to GDP growth next year.
The interruption in January and February of the moderation of the general CPI that began in September 2022 has led the panelists to raise the forecast for the average annual inflation rate by two tenths, up to 4.2% in 2023. For 2024, it is expect an average rate of 2.8%. Regarding core inflation, the estimate rises to 5.5% for this year and is expected to moderate to 3.3% in 2024. The interannual rates for December 2023 and December 2024 would be 4.1% and 2.3%, respectively.
Regarding the evolution of the labor market, analysts expect the “positive tone” to continue and the consensus forecast for employment growth is 1.1% for 2023 and 1.6% for 2024. Thus, The average annual unemployment rate will stand at 12.9% in 2023 and will drop five tenths, to 12.4%, in 2024.
Regarding the evolution of public finances, the panelists foresee a reduction in the public deficit in the next two years. This year it would stand at 4.2%, which is one tenth less than in the previous Panel, and would remain at 3.7% in 2024. According to the Funcas panel, the external context continues to be “uncertain” due to the persistence of inflation, to which is now added the bankruptcy of the US bank Silicon Valley Bank and its impact on the sector.
Despite this episode, the consensus forecasts that interest rates will rise to 4% in the second quarter of the year and remain at that level until mid-2024. Consequently, the Euribor would reach its maximum in the second half of this year at 4%, to be below 3.5% at the end of 2024.
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