The International Monetary Fund predicts that Spain’s growth in 2023 will be 1.2%. Thus, the international organization “corrects” the government, which believes that the Spanish economy will grow by 2.1% next year. Similarly, the IMF is more pessimistic than the Bank of Spain, which released its forecasts last week and estimated Spain’s growth at 1.4% in 2023. Given these three data, the executive branch remains the most optimistic of the organizations.

In addition to being the body with the worst outlook for Spain by 2023, the IMF lowered its own expectations as it pointed to 2% growth in July forecasts. If you look at the April report, the forecast is even more pessimistic, since in that month (when the war in Ukraine was less than two months old), the IMF predicted a growth of 3.3% for Spain in 2023.

However, the International Monetary Fund improved Spain’s growth forecast for this year. The agency believes that the country’s economy will grow by 4.3% in 2022, 0.3% more than the forecast in July (4%), but 0.5% less than the forecast for April. Spain’s growth in 2022 is driven by “a recovery in services related to tourism and industrial production in the first half of the year,” the report said. However, he warns that growth will slow sharply in 2023.

As for growth this year, the IMF’s forecast is more similar to that of the Spanish government, which estimates it at 4.4%. Since the beginning of the year, the executive branch has estimated that the economy will grow by 4.3% this year (now 4.4%). This is also in line with the Bank of Spain, which in this case is the most optimistic of the three institutions, as it forecasts the economy to grow by 4.5% this year.

Spain, according to IMF forecasts, will be the eurozone country with the best performance both this and next year. Sothe eurozone as a whole will grow by 3.1% this year and 0.5% next. The agency revised up this year’s growth by 0.5%, but lowered 2023 growth by 0.7%, as it expected it to rise by 1.2% in July.

However, Germany will be the worst performing country in the euro area as a whole, according to the IMF. The German country will grow by 1.5% this year, but will fall slightly in 2023, by 0.3%. In this case, it has also revised upward this year’s growth and downward in 2023 growth. In fact, in July, the IMF was forecasting 0.8% growth for Germany, compared to a 0.3% fall. predictable now.

According to the organization, Italy will behave a bit like Spain.as it will grow strongly this year, by 3.2% as forecasts show, but will fall by 0.2% in 2023. In this aspect, the IMF also moved away from the positive, as it believed that Italy would grow by 0.7% to minus in three months.

Strong inflation this year

On the other hand, inflation, driven in large part by high energy and food prices, is one of the most talked about indicators this year. In September it was 9%, but in previous months it was above 10% (in August it was 10.5%). The IMF forecast is that it will close the year at 8.8%, which is in line with the forecasts of economic institutions that estimate it at 9%. The Bank of Spain predicts that inflation will close at 8.7%.

As for the forecast for 2023, The IMF expects inflation to fall to 4.9%. The Bank of Spain, for its part, also believes that prices will be moderate during 2023, but puts inflation above the international organization’s forecast, as it predicts it will close at 5.6%.