Bloomberg News

Spain Recession Deepened in Current Quarter, Report Says

June 27, 2012

Spain’s recession probably intensified in the second quarter as the European sovereign debt crisis worsened, the Bank of Spain said.

“The most recent information for the second quarter indicates that activity continued declining at a more intense pace,” the Madrid-based central bank said in its monthly bulletin on its website today. It will publish an estimate of second-quarter gross domestic product next month.

Spain’s economy contracted 0.3 percent in the first three months of the year as the second recession since 2009 pushed the unemployment rate to 24.4 percent. After the deepest austerity steps in three decades failed to reverse a surge in borrowing costs, the government sought a 100 billion-euro ($125 billion) European bailout this month to help rescue lenders.

“In recent weeks the Spanish economy has been strongly affected by the worsening of tensions in financial markets in the euro region,” the central bank said.

To contact the reporter on this story: Emma Ross-Thomas in Madrid at erossthomas@bloomberg.net

To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net


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