IMF revises Spain GDP forecast with larger fall of 12.8% predicted

The International Monetary Fund has revised its predictions for Spain’s GDP and foresees a worse hit to the economy due to the impact of the coronavirus than it warned against in April.

The body predicts that Spanish GDP will fall by 12.8% this year, almost five points more than the calculations it had made previously. 

Originally, the IMF had predicted a fall in Spanish GDP by 8% for 2020. That forecast was down by almost 10 points from their previous prediction in January, which estimated that the Spanish economy would grow by 1.6%. 

Spain is, along with Italy, the European country with the biggest fall in GDP as a result of the Covid-19 crisis. In both cases, the body expects a recovery in the economy of 6.3% for 2021, which is two points of growth above that forecast in April for Spain. 

As for the deficit, the IMF expects it to reach 13.9% in Spain, while public debt will climb to 123.8% of GDP this year.

Eurozone economy down 10.2% in 2020

The IMF's June forecast broadly revises the agency's calculations in April for this year, but points to higher growth in some cases by 2021. 

According to new estimates, the Eurozone economy will fall by 10.2% in 2020 - more than two and a half points a bigger drop than predicted in April - and will rise by 6% next year.