SPAIN’S economy is out of recession but remains in crisis, according to prime minister Mariano Rajoy.
His announcement came as the country’s central bank revealed preliminary figures for the third quarter showed an increase in output of between 0.1% and 0.2%.
Speaking to the Wall Street Journal Rajoy said the forthcoming budget would prudently raise the growth forecast for 2014 from 0.5% to 0.7% even though the consensus of analysis is of growth around one percent.
He went on to say the next big task is to achieve a vigorous recovery that creates jobs.
The unemployment rate is currently forecast to stand at 27.1% in 2014. It dipped to 26.2% in Q2 thanks to summer hiring.
Credit ratings agency Moody’s agreed Spain is emerging from the recession, stating exports would drive the growth, but recovery was flimsy.
Zach Witton, research analyst at Moody’s, said: “The recovery will be weak as the boost to the economy from the pickup in exports will only be modest and fragile domestic demand will drag heavily on growth.
The group forecast Spain’s economy would contract by more than one percent this year before expanding by 0.3% in 2014, and 0.8% in the following year. It warned that rate of growth would be insufficient to generate net job creation until 2016.