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Spending rebound propels Spain's accelerating economy

Published 28/05/2015, 08:44
© Reuters. People are reflected in the window of a store as they stroll and shop at a commercial district in central Madrid

MADRID (Reuters) - Spain's economy grew at its fastest quarterly pace in over seven years in the first quarter, propped up by recovering consumer spending, data showed on Thursday.

Economic output grew 0.9 percent, the National Statistics Institute (INE) said, confirming preliminary readings. On an annual basis it grew 2.7 percent, up from an earlier 2.6 percent estimate.

Spain has emerged as one of Europe's fastest growing economies this year. In common with a number of other countries in the region, it has been lifted by falling oil prices, euro zone stimulus programmes and a weaker euro, which is helping exports.

A recovery in consumer confidence is also going a long way towards helping the economy rebound, after households cut spending sharply during a prolonged downturn.

Retail sales expanded 4 percent in April on a calendar-adjusted basis, rising for the ninth month in a row, according to separate data from INE on Thursday.

But the turnaround has left many Spaniards behind.

© Reuters. People are reflected in the window of a store as they stroll and shop at a commercial district in central Madrid

The country's unemployment rate remains close to 24 percent, and in local elections last Sunday voters delivered a drubbing to the governing centre-right People's Party (PP), which hailed the economic recovery in its campaign.

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