Spain's economy grows further in Q2
Ciaran Giles, Associated Press, Madrid | Fri, 08/06/2010 5:35 PM
Spain's economy took a further step out
of recession by growing in the April-June period, the second
consecutive quarter of expansion after nearly two years of recession,
the Bank of Spain said Friday.
The central bank said gross domestic
product was up 0.2 percent from the previous quarter. GDP rose by 0.1
percent from January to March.
However, the economy remained 0.2
percent smaller than a year earlier.
Spain is the slowest of the major
European Union economies to emerge from recession and prior to
January it had sustained six quarters of negative growth.
The news came a day after the European
Central bank said economic growth in the eurozone is on course to be
better than anticipated in both the second and third quarters, a
further sign of optimism about te 16-nation bloc's prospects.
The Spanish bank's assessment was
provisional and is to be confirmed by the government next week.
It was the third piece of positive
economic news this week for Spain after the number of people claiming
unemployment benefits fell by nearly 74,000 in July, the fourth
monthl reduction in a row.
Spain's overall unemployment rate still
stands at just over 20 percent, the highest in the 16-country
eurozone.
On Thursday, Spain sold bonds at a
lower interest for the third time in a row, indicating increasing
investor confidence following approval of an austerity program of
eur15 billion in spending cuts and labor market reforms.
Stress tests released last month also
showed Spanish banks to be in good shape.
On Friday, the Bank of Spain said the
government's measures were "adequate" but warned they
needed to be fully applied and quickly. It added that the government
shoul consider further fiscal measures to ensure reduced spending
next year.
Socialist Prime Minister Jose Luis
Rodriguez Zapatero has pledged a lean budget for 2011, with average
spending cuts of 15 percent in government ministries.
The EU has said Spain's economy may
register negative growth once again in the third quarter because of
government measures.
