CaixaBank forecasts a drop in household consumption and a rise in unemployment in 2023


The next few months are loaded with uncertainty in the economic sphere due to the war in Ukraine, the energy crisis and the inflation problem faced by the main economies of the planet. This lack of visibility will translate into a Loss of confidence that will weigh down household consumption by 0.7% next year (This year it will fall around 0.1%), according to the calculations published this Monday by CaixaBank Research in its latest monthly economic report.

The study service of the first Spanish entity by volume of assets draws a scenario in which Spanish GDP will put the brakes on and grow at 1% -an estimate in line with the one published last week by the European Commission- and that the unemployment rate will increase to 13.1%, from the 12.67% that was fired in the third quarter of this year, according to the latest Active Population Survey published by the National Institute of Statistics (INE).

In a year in which the arrival of the bulk of European ‘Next Generation’ funds will be essential for Spain, public consumption will increase by 1%, however its momentum will be clouded by a slowdown in investment (it will go from rising 5 .1% this year to 1.8% the next). The reason is that, although investment in construction will increase by 3.9% -in a scenario in which the Bank of Spain itself anticipates that the ‘brick’ will better withstand a more adverse situation than it did in previous crises-, the investment in capital goods (in machines, tools or assets to produce other goods and which, therefore, is more permeable to the evolution of the economic cycle) will fall by 1.3%.

The entity’s economists forecast that Spain is able to reduce the annual rate of inflation to an average of 4.5%. Unlike what is happening in the euro zone as a whole (and in the rest of its largest economies), the rise in prices has been gradually moderating in our country from the ceiling of 10.8% that they touched in July in year-on-year terms up to 7.3%, which Statistics advanced for October. This inflationary scenario is the one that takes tax revenues “in flight”, which according to the second budget scenario that the Government has sent to Brussels in the Budgets for next year, would mean that the public coffers could collect almost 10,000 million more next year.

The structural deficit does not fall despite skyrocketing income

The firm’s economists also point out how the structural spendingthat that does not depend directly on the economic cycle, “will increase significantly” and is the main responsible for the increase in consolidated public spending by 117,000 million euros compared to 2019 (without taking into account the extraordinary spending measures due to inflation and the war in Ukraine that can be allocated in 2023). Specifically, pensions are expected to increase by 36,600 million euros compared to 2019 and personnel expenses by 24,000 million.

Thus, from CaixaBank Research they warn that, although public revenue will have increased by almost 100,000 million euros compared to 2019 and a good part of the increase will be structural due to inflation and the structural changes in the economy that have increased collection (such as the outcrop , due to labor policies during Covid, of workers who were in the underground economy), “this margin is not expected to be used to significantly reduce the structural deficit”.

Thus, they affect the structural deficit of the Spanish economy, which was already relatively high before the pandemic, will hardly decline. Specifically, according to the estimates of the Budget Plan, this could be around 3.4% of GDP in 2023, a level very similar to that prior to the pandemic (3.5% in 2019).

Looking ahead to 2024, the merged entity expects the economy to Spain grows at 1.9% (above what Germany, France and Italy will do)that unemployment falls slightly to 12.8% and that the annual rate of the CPI falls to 2.3%, so it would already be in line with the target set by the European Central Bank.


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