Spain fell deeper into recession between January and March as the economy shrank for the seventh straight quarter.
A preliminary reading showed gross domestic product contracted by 0.5 percent from the last three months of 2012 and it was 2.0 percent down from a year earlier.
The National Statistics Institute said reduced domestic demand was mostly to blame.
The Madrid government continues to put the best spin on the situation, saying the worst of the slump has passed and it expects quarterly growth before the end of this year as Spain has become more competitive and exports are growing.
Indeed, rising exports and weaker imports, which were reported separately, did provide some relief by cutting Spain’s trade deficit.
Exports have been the only pillar of support for the sagging economy since 2008 when a property bubble burst.
This further contraction will add to the Europe-wide debate about whether countries should ease off their austerity programmes intended to cut debt in favour of more growth-focused policies, particularly given concern about rising unemployment. Spain’s jobless rate is 27.2 percent.
Spain, the eurozone’s fourth largest economy, has been on the front line of the bloc’s debt crisis because it has one of the region’s highest public deficits.
This has prompted Madrid to pass a series of unpopular austerity measures that critics say has hobbled recovery.