They cut their estimates for inflation by two tenths, to an average of 3% in 2024


The General Council of Economists (CGE) has raised its growth forecast for the Spanish Gross Domestic Product (GDP) by three tenths in 2024, to 1.9%, and they estimate a public deficit this year of 3.4% of GDP.

The latest ‘Financial Observatory of the General Council of Economists’, published this Tuesday, points out that this increase in the forecasts for 2024 responds to the good performance that the economy is registering and the maximum expectations in tourism and, in general, in the sector services in this first semester.

“It could become even higher if the positive evolution of the main indicators, such as inflation or the active population, continues,” point out the economists, who estimate a growth of 0.5% in the first quarter of the year.

However, economists have also warned that this momentum may be hindered by the contraction of public consumption and the lack of General State Budgets (PGE) for this year.

In this sense, the General Council of Economists points out that the inflation rate has been moderating throughout 2023 and in the first three months of 2024. Although the advance data for the month of March places an increase in the general index of the 0.8%, in an interannual rate the increase has been 3.2%.

In addition, core inflation, with the structural component it has, has gone from an interannual rate of 7.5% in March 2023 to 3.3% last March. Based on these data, economists have revised the average CPI forecast downward by two tenths, to 3%.

Regarding employment, economists have revised their forecast for the unemployment rate downward by two tenths, to 11.5%, given its good performance in the first months of the year.

Regarding the deficit, it is expected to remain around 3.4% of GDP in 2024 after having closed 2023 at 3.6%. This estimate is four tenths more than the Executive’s forecast and is above what is required by Brussels after the reactivation and reform of fiscal rules (3%).

In addition, economists have urged control of public debt, which they predict will stand at 106.6% this year, given the increase in financing costs due to the rise in interest rates.