Uncertainty from US President Donald Trump’s tariffs, and the risk that they result in a global slowdown, has forced Spain’s central bank to downgrade its 2025 economic growth forecast.
It has predicted that Spain – the eurozone’s fourth-largest economy – will now grow 2.4% this year, down from a previous forecast of 2.7%.
A 90-day pause on tariffs announced by the EU and the US is slated to end on 14 July. About halfway through that grace period, Trump announced 50% tariffs on steel imports. The US has also enacted a 25% tariff on vehicles and 10% so-called reciprocal tariffs on most other goods. ALSO READ: Trump and Von der Leyen agree 9 July deadline to reach US-EU tariff deal after 50% threat.
The Bank of Spain said in a statement that a ‘small slowdown in the pace of GDP growth’ was expected over the second half of 2025. It also lowered its 2026 forecast from 1.9% to 1.8%.
The recalculations were due to ‘heightened uncertainty’ for the world economy, the bank said.
Markets ‘remain very vulnerable to possible negative disruptions that could arrive in coming weeks’, it said, noting that dipping confidence would likely have ‘a negative impact on consumption’.
While the Bank of Spain said that negotiations the United States was holding with major trading partners held out hope of ‘de-escalation’, it did not rule out ‘an intensification of the trade war’.
In its own forecasts given at the end of last year — before Trump took office and subsequently announced the higher US tariffs — the European Commission forecast 2.6% growth for Spain this year.
On the possibility of more US tariffs on EU goods, Spain’s Economy Minister Carlos Cuerpo said in an interview with the Press Association on Tuesday that he believed the EU still wanted to reinforce economic ties with the US
‘From the EU side, we are constructive but we are not naive,’ Cuerpo said, adding that the bloc would pursue ‘other routes protecting our firms and industries’ if no agreement with the Trump administration can be reached.
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El crecimiento del PIB en 2025 se revisa a la baja en tres décimas, hasta el 2,4%, debido a los últimos datos de la Contabilidad Nacional y al impacto de las tensiones comerciales y de la elevada incertidumbre, que solo son compensados, en parte, por el mayor gasto en defensa… pic.twitter.com/FqAQmNYN6L
— Banco de España (@BancoDeEspana) June 10, 2025
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