• Economic Crisis BBVA Research joins the massive reduction of forecasts and reveals the macro picture of the Government

"

You have made them a suit to the Government Budgets

." The deputy for Citizens, María Muñoz, thus began her first turn to speak after the appearance of the Government of the Bank of Spain, Pablo Hernández de Cos, in the Congress of Deputies to analyze the General State Budget Project (PGE) for 2022 And although the term may be a bit colloquial and may even seem excessive, the truth is that the head of the regulator has corrected key aspects of the accounts, showing that the Budgets are based on somewhat flimsy figures.

To begin with, because the growth will not be, at all, the one predicted by the Government. Hernández de Cos has not yet released a new forecast after which the BdE made public in September, but he has anticipated that there will be a sharp cut in the estimate after the historic

revision of the National Institute of Statistics (INE

); "mismatches in

global

supply chains

"; the "

bottlenecks

in the industry that have hit advanced economies the most"; and "the insufficiency of the supply of some goods and services to supply the demand has generated an

increase in prices

"

"The developments I have described to anticipate a significant downward revision of growth in the current year in Spain. (...) If you consider the panel forecast

Consensus Forecasts

, which has a monthly frequency, it can be seen how in the last edition, published in mid-October, the panelists have revised downward by 5 tenths, in the last month, their forecast of GDP growth this year, up to

5.6%

", he pointed out, a figure that contrasts with the 6.5% expected by the Government.

"The average of the projections for 2022 has remained more stable, standing slightly above

6%,

" he added.

Once again, the data contrasts with the 7% advanced by the Executive and, taking into account the deviations of both years, the joint difference will be around up to two percentage points.

In addition, with this warning, the BdE joins the International Monetary Fund (IMF), BBVA Research or the General Council of Economists, which are some of the many organizations and analysis firms that have carried out a

massive reduction of the forecasts

growth for Spain.

Risks to the decline in income

Regarding revenues, the Government expects a notable increase of 8% in tax collection only due to the rebound in economic activity itself.

The new figures will have "a very reduced tax collection impact," according to Hernández de Cos.

And taking into account that the expected growth is totally in doubt, there are some obvious "risks" that could "

lead to lower income,

" said the governor.

According to the criteria of The Trust Project

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