CaixaBank Research Revises Spain's Economic Growth Forecast Up to 2.9% for 2025
CaixaBank Research upgrades Spain's 2025 GDP growth forecast to 2.9%, citing economic resilience, ECB rate cuts, and stable energy prices despite global risks.
- • CaixaBank raises Spain's GDP growth forecast to 2.9% for 2025 and 2.1% for 2026.
- • Key growth drivers include lower ECB interest rates, decreasing energy prices, and high migration flows.
- • Inflation expected to average 2% in 2026, aligning with ECB targets.
- • Growth moderation expected due to normalized tourism and demographic changes.
Key details
CaixaBank Research has raised Spain’s economic growth forecast for 2025 to 2.9%, up from the earlier estimate of 2.4%, and revised the outlook for 2026 to 2.1%, up from 2%. This significant upward adjustment reflects the surprising resilience of the Spanish economy amid challenging global conditions, coupled with an upward revision in recent growth data by the National Institute of Statistics (INE).
According to CaixaBank, the factors supporting this sustained growth include lower interest rates set by the European Central Bank (ECB), decreasing energy prices, and relatively high migration inflows. The ECB's policy of reducing rates, which is expected to keep interest near 2% through 2026, has been a key driver behind the improved forecast. Inflation is projected to stabilize at 2.5% by the end of 2025 and average 2% in 2026, aligning well with ECB targets. This moderation is attributed to the removal of the VAT normalization effect on electricity bills starting January 2025, as well as moderated food prices.
However, CaixaBank cautions that growth may moderate due to the normalization of tourism activity following the pandemic boom, a reduction in public spending, and slower migration flows. Additionally, the report highlights ongoing risks posed by geopolitical tensions, global supply chain disruptions, and uneven economic recovery within Europe — noting Spain's comparatively robust GDP growth against challenges in Germany’s industrial sector and France’s public finances.
Energy prices are expected to remain stable, with Brent crude oil forecasted to drop slightly to around $65 per barrel by December 2025, and European natural gas prices stabilizing near €35 per MWh. This stability will play a crucial role in supporting Spanish industry and business growth in the near term.
CaixaBank Research’s assessment paints a picture of cautious optimism: Spain’s economy is performing better than anticipated in a complex international environment, benefiting from favorable monetary conditions and moderated inflation. Yet, external uncertainties and demographic challenges mean vigilance will be necessary to sustain this momentum over the coming years.