DOMESTIC DEMAND WILL CONTINUE TO DRIVE GROWTH
Domestic demand will remain the main engine of the economy, contributing 2.9 percentage points to GDP growth in 2026. Household consumption will increase by 2.7%, while investment will grow by 4.5%, driven particularly by construction. However, a slowdown is expected in 2027 due to the loss of purchasing power, tighter financial conditions and weaker support from Next Generation EU funds.
Inflation will remain one of the main risks. The Chamber of Spain expects prices to rise by an average of 3.2% in 2026, five-tenths of a percentage point more than previously estimated, as a result of higher prices for certain food and energy products and the gradual withdrawal of extraordinary government measures. In 2027, inflation is expected to moderate to 2.4%, while core inflation would stand at 2.1%.
NEARLY 480,000 NEW JOBS IN 2026
The strength of the labor market has also led to improved employment forecasts. Employment will grow by 2.3% this year, resulting in the creation of nearly 480,000 jobs, while the unemployment rate could end 2026 at 9.7%. A further 350,000 jobs and a reduction in unemployment to 9.1% are expected in 2027, although the Chamber warns that productivity continues to advance at a more limited pace.
The external sector will show greater moderation, with exports expected to grow by 1.4% this year, although Spain will maintain a positive current account balance equivalent to 2.3% of GDP. The Chamber believes the challenge will be to turn the current economic strength into sustainable long-term growth by improving productivity,
