Spanish economy beats forecasts with 3.1% annual growth in 2nd quarter

Spain's economy expanded at a faster pace in the second quarter of 2025, lifted by household spending and investment, though foreign trade weighed on growth, data from the National Statistics Institute showed Friday.

According to INE, gross domestic product rose 0.8% quarter-on-quarter in volume terms, picking up pace from 0.6% growth in the first quarter.

On an annual basis, GDP grew 3.1%, below the 3.2% recorded in the previous quarter but ahead of the FXStreet-cited consensus of 2.8%.

Domestic demand contributed 3.5 percentage points to annual growth, while external demand subtracted 0.5 points. Household consumption rose 0.8% on the quarter and investment climbed 1.8%. Public spending edged up 0.1%.

Exports grew 1.3% quarter-on-quarter, slowing from 1.7% the previous quarter, while imports remained unchanged at 1.6% growth.

By sector, construction led the growth with a 2.3% quarterly rise, services expanded by 1.0%, and industry added 0.9%. Agriculture fell 6.4% after a strong prior quarter.

Employment also strengthened, with full-time equivalent jobs up 3.5% year-on-year, compared with 2.9% in the first quarter.