Spain economy is growing at its fastest pace in seven years, Government … – Reuters

       

By Julien Toyer and Sarah White

       

MADRID (Reuters) – The Spanish economy grew in the first quarter at its fastest rate in more than seven years and remained on track to meet the new forecast of full-year expansion of 2.9 percent, but other data they showed that some imbalances persist.

       

The improving economy is the golden letter of the Prime Minister, Mariano Rajoy, to win re-election later this year and face a second term, at a time when polls show the challenge of new political parties broad social support.

       

Also GDP would grow 2.9 percent in 2016, according to projections released later Thursday by the Government, and 3 percent in 2017 and 2018, while the estimate for the unemployment rate improved to 22.1 percent in 2015 from 22.9 percent previously forecast.

       

“We trust that these forecasts will be met even be improved, because we will not cease in compliance with our program of reforms,” ​​said the vice president of the Government, Soraya Saenz de Santamaria.

       

The new forecast expects unemployment rates of 19.8 percent in 2016, 17.7 percent in 2017 and 15.6 percent in 2018.

       

According to analysts, the drop in inflation – the CPI fell 0.6 percent in April – has also helped underpin the recovery by increasing the budget of the families

       

Although Spain appears to have definitely left behind two recessions and a banking crisis and now shows one of the fastest growth rates in the euro zone, the high unemployment rate still downplays the turnaround.

       

The high public deficit and gross external debt of around 170 percent of GDP, one of the largest in the world, are other threats to recovery. More …