The Spanish government maintains its growth forecast despite trade tensions.

MadridThe tension in international trade due to the US tariff chaos will affect the Spanish economy. The extraordinary cabinet meeting this Wednesday. "Despite the tariff chaos, this week's power outage, and the natural disaster caused by the DANA, the Spanish economy will continue to lead the major eurozone economies in terms of growth," Cuerpo reiterated, estimating the impact at €400 million. the economic impact of the electrical incident

Now, that is the impact estimated by the Minister of Economy regarding financial transactions that were blocked, for example, in shops or restaurants. "The maximum impact would be 800 million euros," added Cuerpo, when he included other issues such as industrial activity or the loss of certain materials. In any case, the minister pointed out that economic activity has already recovered, which includes the "recovery" of many payments.

Cuerpo already announced last February that the government estimated gross domestic product (GDP, the indicator that measures the size of an economy) growth of 2.6% this year, that is, one-tenth more than what was projected in October 2024, when it published the fiscal plan. This is a more optimistic economic growth forecast compared to the forecasts of most international organizations. In fact, the Bank of Spain has even anticipated a downward revision due to Donald Trump's tariff policies. Looking ahead to 2026, the Spanish government forecasts economic growth of 2.2%.

The Minister of Economy explained that the key to the economy's good performance is private household consumption. The government expects this element to "offset," in Cuerpo's words, the slight impact of the tariff chaos: "It will reduce the foreign sector's contribution to economic growth by one-tenth of a percent," Cuerpo explained.

In addition to household consumption, investment will also be added, which the Spanish government also expects to improve. Finally, the labor market is expected to remain strong. Cuerpo emphasized that the "strength" of employment will translate into an improvement in workers' purchasing power and indicated that the unemployment rate will fall to 9.6% in 2026. "[This rate] would be close to full employment," the Minister of Economy stated. Finally, the Spanish government maintains a public deficit of 2.5% in 2025 (it would be 2.8% if public spending for the DANA is taken into account) and forecasts that the debt will reach 101.7% of GDP, thus complying with fiscal rules.

First monitoring report

This Wednesday's macroeconomic update was carried out as part of the monitoring of the structural fiscal plan for the period 2025-2028 presented in October of last year. In compliance with the new fiscal rules, the Spanish government must send an annual monitoring report on this plan to Brussels, which it will do this Wednesday. The report that the Spanish government must send to the EU executive branch must describe how the structural fiscal plan is being implemented. The plan aims to restore public administrations' health following the increase in spending resulting from COVID-19, when the fiscal rules were suspended.