Spanish economy contracts for seven consecutive quarters

| February 11, 2010 | 0 Comments
Spanish economy contracts for seven consecutive quarters

The Spanish economy is still in recession after the economy contracted by 0.1% in the fourth quarter of 2009 - the seventh consecutive quarter of contraction.

The figures from the INE, the national statistics agency, show that Spain is now the last major economy still in recession.

Meanwhile, on an annual basis, the economy shrank 3.1% compared with the same period a year earlier and 3.6% over the whole of 2009 - the sharpest drop in over 50 years.

The Spanish economy, which is the euro zone’s fourth largest, has the highest rate of unemployment within the 16-member bloc.

The unemployment rate currently stands at 19.5%, against a rate of 10% within the euro zone as a whole. The country has been hit by a severe slump within the construction industry, which has led to a significant amount of job losses.

Commenting on today’s GDP figures, Ralph Solveen, an analyst with Commerzbank, said: “These figures shows the Spanish economy is struggling to catch up with the European monetary union.

“Maybe there’s a chance we’ll see some positive quarter-on-quarter growth this year. Even so, Spain’s economy will continue to remain behind the economies of its eurozone neighbours,” he added.

In the meantime, the euro zone’s three largest economies France, Germany and Italy are due to report their fourth quarter GDP figures tomorrow and are all expected to show positive quarter-on-quarter growth.

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