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Spain's economy further pressured

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Spain's economy further pressured

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The number of registered jobless in Spain hit a ten year high in July as consumer confidence fell to a record low. That prompted Spain’s economy minister to say he couldn’t rule out the country falling into recession.

The number of people claiming unemployment benefit rose for the fourth straight month. The total – 2.43 million – is 23% higher than July last year. At the same time, the Spanish consumer confidence index, which is calculated by the country’s official credit institute, fell to 46.3. One year ago, it was at 92.5.

The collapse of Spain’s construction sector after a decade long boom is a major factor in pushing up the jobless figures and driving down confidence.

That – along with higher energy prices – has Economy Minister Pedro Solbes warning of a possible recession. In a radio interview he said: “The fourth quarter could present us with difficulties, depending on how things develop.” Solbes said he does not expect a recovery until late next year.

Spanish retail sales suffered a record fall in June as inflation hit a 13 year high and house prices fell for the first time in almost 10 years.