Spain’s National Statistics Institute (INE) adjusted the 2024 GDP growth figure to 3.5%, an increase from the previously estimated 3.2%. Conversely, Spain’s GDP growth for 2023 was revised downward to 2.5% from 2.7%, while the 2022 figure saw a slight rise to 6.4% from 6.2%.
In 2024, the Spanish economy was one of the few strong performers within Europe. Challenges faced by Germany and France contrasted with Spain’s positive economic outlook. Germany dealt with a manufacturing recession, whereas France had limited domestic demand growth and found some relief from the Olympic games effect.
Upward Revision Shows Robust Economic Picture
The upward revision of Spain’s 2024 GDP growth to 3.5% confirms the robust economic picture we saw last year. This strength stood out, especially when compared to the struggles in Germany and France during that same period. For us, this is historical confirmation rather than new, market-moving information for late 2025.
Looking at more recent data, Spain’s Q2 2025 growth came in at a solid 0.6%, but this indicates a potential cooling from last year’s pace. Meanwhile, Germany’s manufacturing PMI has finally crept back above 50 for two consecutive months, suggesting their downturn may have bottomed out. This changes the dynamic from last year’s clear divergence trade.
Therefore, outright bullish bets on the IBEX 35 may offer less value now than they did twelve months ago. We see implied volatility on IBEX options as potentially underpriced, given the uncertain outlook for 2026. Traders could consider strategies like selling cash-secured puts on dips, anticipating that the strong 2024 foundation will provide a floor for the market.
Spread Between Spanish And German Bonds
The spread between Spanish and German 10-year government bonds, which tightened considerably through 2024 and early 2025, now appears to have stabilized. We saw this spread hit a multi-year low of around 85 basis points in July 2025. Any further tightening from here seems unlikely without fresh catalysts, suggesting positions that bet on a range-bound spread could be favorable.
The tourism sector, a key driver of last year’s success, reported record arrivals for summer 2025 but at a decelerating rate of spending growth. Spanish banks, like BBVA and Santander, continue to benefit from the European Central Bank holding rates steady through the summer. Their stock performance may now be more tied to broad European rate policy than to purely domestic growth stories.
