Overview

• OECD lowers Spain's GDP growth outlook to 2.4% in 2025 and 1.9% in 2026, marking a two-tenth reduction from previous projections.
• The downgrade reflects the impact of US trade tariffs and a slowdown in international demand that are dampening export activity.
• A robust labor market, rising household incomes and European recovery funds are expected to sustain domestic spending.
• Spain's public deficit is projected to narrow to 2.8% in 2025 and 2.3% in 2026 while inflation should ease to 1.9% in 2026.
• Global growth forecasts have been trimmed to 2.9% for both 2025 and 2026 with significant downside risks from escalating trade and geopolitical tensions.