It put core inflation, excluding food and energy prices, at
3.9% in 2023.
The bank's chief economist Angel Gavilan predicted a
fall in general inflation in March to 3-4% from 6% in February,
due to the base effect of lower energy prices compared to last
year.
Gavilan said food prices were still rising sharply and he
expected average food inflation to hit 12.2% this year, up from
7.8% at end-2022.
(Reporting by Jesus Aguado and Belén Carreño, editing by Andrei
Khalip and Elaine Hardcastle)
(Adds chief economist on March inflation, food price trend)
By Jesús Aguado and Belén Carreño
MADRID, March 22 (Reuters) - The Bank of Spain expects
the country's economic growth to accelerate slightly to 0.3% in
the first quarter from 0.2% in the preceding three months and
end the year at 1.6%, above its previous estimate of 1.3%, it
said on Wednesday.
The central bank also warned that the global financial
sector turmoil could weigh on economic growth in the coming
quarters and its projections did not take into account that
latest adverse shock.
The revision of the official growth forecast for this year
was in line with last month's predictions by the bank's chief
economist and came largely thanks to a knock-on effect from
stronger-than-expected expansion of 5.5% last year.
As supporting factors, the central bank mentioned the easing
of inflationary pressures, the reopening of the Chinese economy
and the easing of bottlenecks in global supply chains, and the
implementation of investment projects backed by EU funds.
Regarding the first quarter, it said recovering tourism was
a major growth driver, with overnight stays by foreigners
reaching pre-pandemic levels in January for the first time.
However, the financial authority revised next year's growth
forecast down to 2.3% from 2.7%, mainly due to a more
restrictive monetary policy aimed at reducing inflation, and
stuck to its 2.1% estimate for 2025.
The central bank lowered its prediction for Spain's
EU-harmonised consumer inflation to 3.7% this year from 4.9%
estimated previously and after 8.3% in 2022, projecting a
slowdown in price increases to 1.8% in 2025.
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