Focus on Spanish Recession Danger
ECRI
30-April-2008
In the past decade the Spanish economy has enjoyed an unprecedented housing market boom that has tripled home prices. Strong construction growth has been a key force behind its impressive economic performance in the past few years.
The housing bubble is now imploding, a situation made worse by the international credit crisis. Home sales have been plunging and the construction sector is shrinking. Meanwhile, home prices actually declined in the first quarter of 2008. Given the global growth slowdown that is currently underway, will the housing downturn push the Spanish economy into recession? ECRI’s latest analysis examines key Spanish leading indicators to determine what lies ahead for the Spanish economy and its ailing housing sector. The conclusions point to a serious dilemma for Eurozone policy makers.
This information is excerpted from a full report issued on April 28, 2008 to professional subscribers. For information on how to read the complete story and to subscribe to ECRI's services click this link.