GDP grew 0.6% in the third quarter, but slowed down two tenths due to the unfavorable external environment

The Spanish economy continued to grow in the third quarter of the year, although it did so at a somewhat slower pace than that recorded in the previous three months. The National Institute of Statistics (INE) revealed this Wednesday that the national GDP it advanced 0.6% between July and September, two tenths less than what had marked the second quarter of the year.

The big culprit for the slowdown was an unfavorable external environment in which the weight of global uncertainty and the tariff war launched by Trump begin to weigh on the economy. Specifically, external demand subtracted six tenths of growth to Spain in the third quarter, a negative effect that is unprecedented since the second quarter of 2020.

Exports of goods decreased by 1.3% in the third quartera fairly abrupt change of sign after having grown by 1.7% between April and June. On the other hand, sales of services abroad grew by 0.7%, two tenths more than the previous quarter. These figures indicate that Restrictions on international trade are already beginning to filter into the Spanish GDPin line with what Spanish companies denounce, which see how the global tariffs they bear have skyrocketed by 13%.

However, the cooling of activity due to the drop in exports has been offset by a rebound in activity within Spanish borders. The great engine that drove the economy in the third quarter was domestic demanddriven by household consumption and investment, one of the components that was doing the worst since the pandemic broke out. Domestic demand contributed 1.2 points to growth, four tenths more than the previous quarter thanks, fundamentally, to consumption, which contributed nine tenths to the growth of GDP.

Specifically, the INE reflects that Family consumption increased by 1.3% between July and Septembera pace that doubles that of the previous period and is consistent with the good performance of the labor market. Regarding investment, the increase in activity is 1.7% and stands out especially in intellectual property products, where it rose 2.4%.

The growth rate maintained by the Spanish economy continues to be much more dynamic than that of most countries in the European environmentmired for several quarters in a situation of economic stagnation. Spain has now accumulated 20 consecutive quarters of chaining GDP increases, the last nine with a growth equal to or greater than 0.6% quarter-on-quarter.

For the Ministry of Economy, the data known this Wednesday “consolidate” the good prospects for the Spanish economy this year, in line with what the main analysts indicate. “Spain will once again lead the main advanced economies, with an advance of 2.9% according to the IMF or even higher according to other organizations,” they say.