Spanish unemployment has hit a new record high. According to the national statistics agency, the unemployment rate reached 24.4 percent at the end of March, with a record 5.64 million people being unemployed. Just in the first three months of the year, 365,900 people lost their jobs in Spain.
Spain has the highest unemployment rate in the European Union and it is expected to rise further this year. Other figures released today showed that Spanish retail sales were down 3.7 percent in March from the same point a year ago, the 21st month in row sales have fallen.
The Bank of Spain said earlier this week that the country’s economy contracted by 0.4 percent in first three months of this year, after shrinking by 0.3 percent in the final quarter of last year. Official GDP figures to be released on Monday are expected to confirm that Spain has fallen back into recession.
Yesterday, the ratings agency Standard & Poor’s (S&P) cut Spain’s rating by two notches to BBB+, warning that the country might have to take on more debt to support its banking sector. S&P predicts the Spanish economy will shrink by 1.5 percent this year, having previously forecast 0.3 percent growth.
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