Spain Economic Recession - La Caixa believes that the recession will last until end 2009

Employment is expected to reduce half the 3% and the average unemployment rate reached 15.2% and 16% attrition in the last quarter, to 3,700,000 unemployed

La Caixa an estimated decline of the Spanish economy of 1.3 percent in 2009 and ensures that the economic downturn will last until the last quarter of this year or the first of 2010.

That explained the chief economist of La Caixa, Jordi Gual, during the presentation of the monthly economic report prepared by the organization department of studies and ensuring that the current economic crisis will have a "less harsh" while a "longer period" that Spanish economic recession of 1993.

The study forecasts that employment is reduced by an average of 3% and the average unemployment rate reached 15.2% this year and 16% attrition in the last quarter, to 3,700,000 unemployed, a figure that would rise in the first months of 2010.

However, as explained Gual, the Research Department "does not see this year's four million unemployed and that there are" factors to be optimistic, "such as low inflation is achieved and the expected decline in interest rates . Thus, the report forecasts that the CPI will fall below 2% in the coming months and the average inflation in 2009 reached 1.4%, while an estimated drop in interest rates to 1.5% in the second half of the year.

Gual said that the fall of the Spanish GDP is higher in the first and second quarter of 2009 and growth will not occur until the fourth or the first quarter of 2010.

In this regard, said the economic downturn could last five consecutive quarters (taking into account the negative data from the third quarter of 2008 and the decline forecast for the fourth quarter).

This decrease is due to falling domestic demand of 2.7% and investment in about 8%, mainly for the construction, which would fall 10.3% in 2009. Household consumption returned 1.8% while the government would grow by 3.8%.

According to Gual the "real adjustment" is to be "harder and longer" than in the recession of 1993 and Spanish as "burdens" the high level of debt and excessive dependence on external financing. However, they also considered that "there is an excess of pessimism" and estimated that the economy is natural adjustment mechanisms that prevent the sinking in misery. "

He stressed that Spain has room for the drive to increase the fiscal and debt, and calculated the public deficit in 2009 at an average rate of 5.5%. He also praised the benefits that the Spanish economy will bring down the price of raw materials and oil, and estimated the value of net imports of energy this year, down 1% of GDP. Also, according to the Economic Report of La Caixa, the European Central Bank might again lower interest rates 0.5 points in their next two revisions, which would "reduce the cost of access to housing." On the international economic situation, the chief economist of La Caixa, said he was optimistic that the banking crisis "is in the process of stabilizing go."