08-28-2014, 03:44 PM
| | Spain’s economy grows 0.6% in Q2, but CPI flags deflation
Spain`s economy is growing even faster than previously estimated, according to the second-quarter final Gross Domestic Product (GDP) data released Thursday, but the country has also taken a perilous step toward deflation as its inflation rate falls sharply on the year ending August.
GDP growth of 0.6 percent outstripped the Bank of Spain`s prediction that GDP may have grown 0.5 percent on the quarter, and marks one of the strongest performances in the eurozone, putting annual Spanish GDP growth in the second quarter at 1.2 percent.
Still, the danger of deflation is once again present for the euro-area`s fourth-largest economy, where annual Consumer Prices Index (CPI) fell 0.5 percent as expected after falling 0.4 percent a year ago. Spain`s European Union-harmonized consumer-price index was down 0.5 percent on the year ended August.
The euro continued its jump to the upside, driving the EURUSD pair to trade around $1.32146, while recording the highest level of $1.32176 and lowest of $1.31878.