Spanish consumers helped push the pace of growth to the fastest in eight years in the second quarter, as domestic demand reinforced its position as the main driver of the recovery.
Household consumption rose 1 percent on the quarter and maintained the pace of expansion at 3.5 percent on an annual basis, the National Statistics Institute said Thursday. Imports increased 2.3 percent in the three months to June, while exports were 1.6 percent higher.
Overall, gross domestic product expanded 1 percent in the second quarter and 3.1 percent from the same period a year earlier, confirming a July 30 estimate and matching a Bloomberg News survey. The Spanish economy has now added eight consecutive quarters of growth.
“We believe the economy is going to maintain an intense level of growth going into the next quarter,” Deputy Economy Minister Inigo Fernandez de Mesa told reporters at a press conference in Madrid.
Initially led by exports, the recovery is now gaining momentum as employment rises and lower energy prices boost Spaniards’ disposable income. Consumer confidence rose to a record in July and Economy Minister Luis de Guindos has said the economy may maintain its pace of growth this quarter.
Earlier this week, the government reiterated its growth target of 3.3 percent for this year, twice the average for the euro area. Despite the pickup in growth, organizations such as the International Monetary Fund repeatedly have warned structural imbalances remain unsolved, including “very high” unemployment, low productivity and high levels of debt.
Joblessness stands at about 22 percent, second only to Greece in the European Union, and the nation’s debt is approaching 100 percent of gross domestic product.