Strong domestic consumption rescues Spain's GDP from the drag of the external sector at the end of the year

 

The Spanish economy ended 2025 with an advance of 2,8 %, according to the data from the progress of the Contabilidad Nacional Trimestral published by the Instituto Nacional de Estadística (INEThis growth was based on the strength of the national demand compared to an external sector that subtracted from GDP.

 

Fourth quarter analysis: Domestic demand and the external sector

 

During the fourth quarter of 2025, the Gross Domestic Product (GDP) registered a quarterly increase of 0,8 %This represents an acceleration of two tenths of a percentage point compared to the previous period. Year-on-year growth stood at 2,6 %, showing a slight adjustment of one tenth compared to the third quarter.

 

The spotlight in this final stretch of the year fell on the domestic demand. On the contrary, the external demandDespite showing dynamic flows, it had a negative contribution to the overall progress of the economy due to the strong pace of imports, which exceeded the advance of sales abroad.

 

Investment, exports and the labor market

 

La gross fixed capital formation (Investment) experienced a year-on-year slowdown, settling at 6,5 % compared to 8,2% in the previous quarter. However, divergent behaviors are observed depending on the asset:

 

• Machinery and equipment: It recorded a moderate rate of 1,2% quarterly.
• Living place: Gross fixed capital formation in this sector accelerated by three tenths, reaching 2,7%.
• Exports: They grew by 3,5% year-on-year, improving by seven tenths the figure for the previous quarter.

 

Regarding the labor market, employment, measured in full-time equivalent jobs, advanced by 2,8% year-on-yearThis dynamism resulted in the creation of approximately 600.000 jobs in the 2025 group. However, the negative note is struck by the labor factor productivity, which retreated a -0,2%, accumulating three consecutive quarters of negative rates.

 

Economic Indicator (2025)	Data / Variation
Annual GDP Growth 2025	2,8 %
Fourth Quarter GDP Growth (Year-on-Year)	2,6 %
GDP Growth Fourth Quarter (Quarterly)	0,8 %
Job Creation (Annual)	600.000 gastro stands
Investment in Capital Goods (Quarterly)	1,2 %
Labor Productivity (Year-on-Year)	-0,2%

 

Outlook for 2026 and structural challenges

 

Looking ahead to the current fiscal year, the Cámara de España It anticipates a moderation in the pace of growth, projecting GDP growth of 1,9 % by 2026. The external sector is expected to regain prominence thanks to the dynamism of European trading partners, while employment could grow by 1,6 %, placing the unemployment rate at 10,2 %.

 

The institution warns of a more restrictive fiscal scenario due to the extension of the State Budget and the depletion of European funds. According to the Cámara de EspañaIt is urgent to implement reforms that place the company at the center: "Without productivity increases, economic growth will be insufficient to generate the necessary income without resorting to higher levels of debt."

 

Key points and frequently asked questions about the Spanish economy 2025-2026

What was the main driver of growth in 2025?

The 2,8% growth was primarily driven by the national demand, which offset the negative contribution of the external sector in the last part of the year.

What is expected for the labor market in 2026?

The creation of some is planned 380.000 jobsThis would allow the unemployment rate to be reduced to 10,2% of the active population.

What are the main risks to the economy according to the Spanish Chamber of Commerce?

The main challenges include the low productivity, high public debt and a stricter fiscal environment marked by the reactivation of EU fiscal rules.