The governor of the Bank of Spain (BdE), Pablo Hernández de Cos, warned yesterday that the institution’s analysts will “significantly lower” their forecasts for Spanish economic growth this year. He did so during his speech to the Congressional Budget Committee, to give his opinion on the draft general state budget for 2022.

In addition, Hernández de Cos said he believed some general budget revenue had been calculated too optimistically. In this regard, the governor assured that the BoE will not publish new macroeconomic projections before December.

It should be recalled that current BoE estimates point to a growth of Spain’s gross domestic product (GDP) of 6.3% in 2021, which would slow slightly to 5.9% in 2022. However, last month, the National Institute of Statistics (INE) significantly revised downwards its previous estimates of quarterly GDP growth in the second quarter of 2021, from an initial estimate of 2.8% to 1.1%. In light of this, the Governor of the Bank of Spain pointed out that such a significant downgrade automatically leads to a substantial reduction in the average GDP growth rate for 2021 and, to a lesser extent, also for 2022.

Hernández de Cos also highlighted the risks facing the Spanish economy, with particular emphasis on the development of mismatches between supply and demand for goods and the degree of persistence of inflationary pressures.