Without going into the particular sadness of the political moment, "Spain is one of the countries that is doing it better".
This was stated yesterday by Pierre-Olivier Gourinchas, chief economist of the International Monetary Fund (IMF), in the presentation of the update on the outlook for the global economy. In one of his answers he underlined the "uncommon" achievement of Spain, one of the countries that grows the most and that has constrained inflation the most, since it has placed it in a forecast of "no more" than a 3.2%, below the average of the other European economies.
The document notes a slight increase in global growth, despite constant inflation - "Even though it's falling back, you can't sing victory" - and China's loss of strength. If on a global scale the forecast is two tenths higher than in April, Spanish growth has been revised upwards by one point - "It is quite strong", said Gourinchas - and remains at the top. It rises to 2.5% for this year, almost three times more than the 0.9% of the euro zone, which adds up to a tenth, as the Spanish Ministry of Economy underlined. For 2024, the forecast of 2% remains.
That Spain rises more than its surroundings is due to the solidity of the services sector, thanks to the new boost in tourism, revitalized after the lifting of the pandemic closure and the greater confidence of citizens to travel.
"The demand for services has a great impact on countries that are tourist destinations. It's what we see in Spain or Italy", analyzed Gourinchas.
On the contrary, unlike the first stage of opening, manufactures are slowed down. This is reflected in Germany, which falls in a negative projection of a contraction of 0.3% for this year.
The IMF clarifies that forecasts for the world economy remain weak from a historical perspective and are below the annual average (2000-2019) of 3.8%. The slowdown is concentrated in advanced economies, moving from 2.7% in 2022 to an outlook of 1.5% this year and 1.4% in 2024.
The document points out that we are on the right track, but we are not out of danger. The outlook is a little brighter than it was a few months ago. Although the economy remains weak, tilted downward, adverse risks have moderated. But inflation is still a priority. That is why interest rate hikes are recommended, which will cause a cooling. In fact, the report reiterates that the increase in the price of money to combat inflation slows down economic activity. Global inflation is forecast to moderate from 8.7% in 2022 to 6.8% this year (two tenths less than expected in April) and to 5.2% in 2024 (three tenths up).
Core inflation (discarding more volatile prices such as food and energy) is more contained, above central banks' targets, and falling more gradually. It is forecast to rise from 6.5% in 2022 to 6% in 2023 (up three tenths compared to the April study) and to 4.7% next year (four tenths more).
"It is clear that the battle against inflation has not yet been won", assured Gourinchas. “Hopefully, with inflation starting to recede, we have entered the final stage of the inflationary cycle. But hope is not a policy and the final goal can be quite complicated to execute", he acknowledged.
If the main objective is to defeat inflation, the IMF emphasizes that central banks must continue to persevere in raising rates.
"Given the uncertainties, economic policy must be adjusted based on the data and avoid premature easing, before price pressures have properly moderated, and they must continue to use tools to preserve the financial stability when necessary," according to the document.
"Although central banks are primarily responsible for restoring price stability, government spending cuts and tax increases through laws to ensure public debt sustainability can further reduce inflation, as they moderate added demand and underpin the overall credibility of disinflation strategies," the report states.
"This is not a call for austerity", said Gourinchas when he advised that a more restrictive fiscal policy be gradually restored.
