Spanish industrial output eased in January from a month earlier and expanded at its slowest pace since August, official data showed on Tuesday, as global economic uncertainties and tumbling oil prices weighed on growth. Spain's calendar-adjusted industrial output rose 3.5 percent year-on-year in January, data from the National Statistics Institute showed, below a Reuters forecast of a 3.7 percent increase and compared to a 4.1 percent rise in December.
Factory output remained strong in all its main components, with consumer and capital goods expanding 5.7 percent and 9.3 percent year on year respectively. Output was dragged down by energy which fell by 7.5 percent. However, analysts said political uncertainty after an inconclusive election in December, which has left Spanish politicians struggling to reach a pact on the next government, is yet to feed through to the industrial sector.
"The overall picture is that the economy is slowing, but to 0.5 percent at the lowest, and it remains one of the fastest economies in the euro zone," Citi economist, Antonio Montilla, said.
"There will be a feedback from the political uncertainty, but so far the impact has been limited," he said. On Tuesday, acting Economy Minister Luis de Guindos told reporters in Brussels he expected quarterly growth of between 0.7-0.8 percent January to March compared to the end of 2015 when it rose 0.8 percent over the July to September period. He also said he expected the economy to grow 3 percent, or close to 3 percent this year. The government's official forecast for 2016 is 3 percent year-on-year growth after 3.2 percent last year. The impact of the political deadlock has been seen in confidence data, with one consumer sentiment indice dropping to its lowest level since end-2014 in February and a services PMI survey also easing in February due to lower expectations.
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