The Bank of Spain has been more prudent than the Minister of the Economy and Competition Luis de Guindos when it comes to stating that in the fourth quarter the Spanish economy has contracted, but he has abstained from signaling a recession, because the latest available data are still incomplete.
Analyzing the development of household consumption, the Bank of Spain is stating that quantitative indicators are showing marked weakness and pointing to private vehicle registrations, which in October and November have declined around 7% in year-to-year terms.
They are also citing the poor progress of retail trade, although when drawing up a report only factored in October data that showed a 7% drop. Yesterday the INE publicized November data that are even worse than last month.
Investment in capital goods is also showing signs of stagnation recently, with declines in production branches throughout October and November and investment in construction project not averring from a downward trend. Materials and cement usage appears to be down as well.
A steady drop in employment throughout the sector is also reflected in the data, because Social Security filings dropped 15.3% year-to-year in November, putting filings at 2% less than where they were last quarter.
