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BBVA Revises Down its GDP Growth Forecast for 2021 to 5% with a 1.5% Expected Decrease in House Prices

The forecast improvement in the tourism sector is postponed until 2022, with the recoveries in the Balearic Islands (11%) and the Canary Islands (9.6%), as well as in Madrid (7.4%) and Cataluña (7.2%) boosted by European funds.

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BBVA Research’s Regional Observatory for the first quarter has revised down its growth forecast in 2021 for all the Spanish regions. Specifically, it has reduced the growth forecast for Spain’s GDP in 2021 from 6% to 5.5%.

The bank warns that “there are risks of possible solvency problems, which means that certain measures will need to be taken to contain the debt, restructure it and avoid excessive indebtedness if a rapid reactivation of the economy cannot be achieved”. The research service bases its revised forecast on the fact that dynamism in terms of national consumption and exports is somewhat lower than previously expected, and “the recovery in tourism will arrive somewhat later”.

Read the full article in Spanish.

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