Spain sinks deeper into recession in first quarter

14th May 2009, Comments 0 comments

The fall in 1.8 percent output is the worst contraction in the past nine months.

Madrid – The Spanish economy slid deeper into recession in the first quarter of this year, official data showed on Thursday revealing that output shrank by 1.8 percent from the level in the previous quarter.

This was the third monthly contraction in a row after a fall of 1.0 percent in the last quarter of last year from the level in the third quarter which had shown negative growth of 0.3 percent.

The National Statistics Institute, INE, which published the provisional data, said that "the quarterly variation of gross domestic product is minus 1.8 percent".

The figure was in line with an estimate by the Bank of Spain at the end of April.

The widely accepted definition of recession is two quarters running of contraction from output in the previous quarter.

Spain entered into its first recession for 15 years at the end of 2008 and the global credit crunch worsened a correction which was already underway in its once booming housing sector.

The country's unemployment rate soared to 17.4 percent in March, double the average of 8.3 percent for the entire 27-nation European Union, according to the bloc's statistics agency Eurostat which uses harmonised figures.

The INE is to release final figures for the quarter on 20 May.

AFP / Expatica

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