Spanish economy slows down in Q3, grows at 0.7 pct, in line with expectations

According to preliminary data from the National Statistics Institute (INE) on Friday, Spanish economy grew 0.7 percent q/q in Q3, in line with forecasts. The third quarter growth was down from the quarterly growth of 0.8 percent registered in the second quarter.

On an annual basis output grew by 3.2 percent, INE said, exceeding forecasts but down from 3.4 percent in the previous quarter. Last quarter's reading was revised upwards from 3.2 percent.

Spain's economy has largely weathered a 10-month political deadlock caused by two inconclusive elections. A recovery in the job market and record tourism season boosted consumer spending. Sustained consumer strength and exports are helping to maintain the pace of the recovery.

Meanwhile, separate data showed an upward surprise Spanish inflation – the headline EU-harmonised measure of inflation rose from 0 percent y/y to 0.5 percent y/y, not seen since Q3 2013.