Chart Pack: Economic Policy & Funding Programme

Transcription

1 Chart Pack: Economic Policy & Funding Programme 6 November

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3 INDEX 1 MACROECONOMIC SCENARIO AND ECONOMIC INDICATORS PAGE TRENDS IN LABOUR MARKET PAGE FINANCIAL SECTOR INDICATORS PAGE FUNDING PROGRAMME OF THE SPANISH TREASURY PAGE DEFICIT OF THE GENERAL GOVERNMENT PAGE 57-62

4 2 MACROECONOMIC SCENARIO AND ECONOMIC INDICATORS 1 MACROECONOMIC SCENARIO PAGE MACROECONOMIC DEVELOPMENTS: DEMAND-SIDE& BALANCE OF PAYMENTS PAGE DEMAND-SIDE AGGREGATES PAGE BALANCE OF PAYMENTS PAGE MERCHANDISE TRADE PAGE TRADE IN SERVICES PAGE NET INTERNATIONAL INVESTMENT POSITION PAGE 18 3 MACROECONOMIC DEVELOPMENTS: SUPPLY-SIDE PAGE SUPPLY-SIDE AGGREGATES PAGE RECENT SHORT-TERM INDICATORS PAGE INDEBTEDNESS OF THE PRIVATE NON-FINANCIAL SECTOR PAGE THE RESIDENTIAL REAL ESTATE MARKET PAGE CONSUMER PRICE INDEX PAGE 27

5 3 Macroeconomic scenario Macroeconomic scenario (YoY growth rates in percent) Q1 Q2 Q3 Private consumption expenditure General Government consumption expenditure Gross Fixed Capital Formation National Demand (Contribution to GDP Growth) Exports of goods and services Imports of goods and services External demand (Contribution to GDP Growth) Gross Domestic Product Other variables 219 Q1 Q2 Q3 Unemployment rate (in % of Active Population) Full-time Equiv. Employment (YoY Growth) Net lending(+)/borrowing(-) with RoW (% of GDP) Private Consumption deflator (YoY Growth) Headline Balance General Gov't (in % of GDP)* USD/ exchange rate Euro Area GDP growth (YoY growth) Oil prices (Brent, USD/barrel) * Including Financial Sector One-Offs Sources: Ministerio de Economía y Empresa and Ministerio de Hacienda. Shaded areas are realisations. In white, forecasts contained in the Macroeconomic Scenario of the Draft Budgetary Plan -219.

6 Macroeconomic scenario: GDP Breakdown Exports andimports of Goods and Services & Gross Fixed Capital Formation. (% of GDP) Gross Value Added. (% of GDP) Imports Gross Fixed Capital Formation Exports Construction Industry Primary Sector Services (RHS) 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% % -1% Breakdownof Gross Domestic Product. Demand-side (% of GDP) Last Four Quarters 2.2 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% % Gross Value Added by Component. (%of Total GVA) Last Four Quarters Private Consumption Public Consumption GFC Net Exports of G&S Primary Sector Industry Construction Services 4

7 Growth forecasts and Composition IMF. Growth Forecasts for. (Year-on-Year Growth Rates) GDP Growth in the Euro Area. (Year-on-Year Growth Rates) World United States Spain Advanced economies Euro area Germany France United Kingdom Italy Japan France Italy Euro Area Spain Source: IMF. WEO April GDP Breakdown. (Year-on-Year Growth Rates and Contributions to Growth) National Demand External Demand GDP 5

8 Macroeconomic scenario: demand side (I) 8 Private and Government Consumption. (Year-on-Year Growth Rates) 15 Investment in Construction. (Year-on-Year Growth Rates) Private Consumption Government Consumption Investment in Housing Inv. Other Construction Investment in Transport Materials, Machinery & Equipment. (Year-on-Year Growth Rates) Exports & Imports of Goods & Services. (Year-on-Year Growth Rates) Transport Material Machinery & Equipment Exports of Goods & Services Imports of Goods & Services 6

9 Macroeconomic scenario: demand side (II) Private and Government Consumption. (Index =1) Investment in Construction. (Index =1) Private Consumption Government Consumption Investment in Housing Inv. Other Construction Investment in Transport, Machinery & Equipment. (Index =1) Exports & Imports of Goods & Services. (Index =1) Transport Material Machinery & Equipment Exports of Goods & Services Imports of Goods & Services 7

10 Macroeconomic scenario: demand side (III) 2 1 Breakdown of Exports of Goods & Services. (Year-on-Year Growth Rates) Breakdown of Exports of Goods & Services. (Index =1) Goods Non-Tourism Services Tourism Services Goods Non-Tourism Services Tourism Services Breakdown of Imports of Goods & Services. (Year-on-Year Growth Rates) Breakdown of Imports of Goods & Services. (Index =1) Goods Non-Tourism Services Tourism Services Goods Non-Tourism Services Tourism Services 8

11 Macroeconomic scenario: balance of payments & NIIP (I) Current Account, GDP & Unemployment Rates. (Year-on-Year Growth Rates and Ratios) Ratio CA/GDP (LHS) GDP (LHS) Unemployment Rate (RHS) Spain France Germany Italy UK US Source: Instituto Nacional de Estadística and Bank of Spain. Source: World Bank. World Export Shares. (Index 199=1) Nominal GDP Growth vs. Current Account/GDP. 24 Q1-Q Q4-Q Nominal GDP Growth (Year-on-Year Growth Rates) Source: Instituto Nacional de Estadística and Bank of Spain. 25 Goods & Services Excl. Tour. & Ener. Energy Cap. Acc. - 2Q1-Q3 Breakdown of the Current Account & Capital Account into its Components. 9 ( bn. 12-Month Rolling Sums) Source: Instituto Nacional de Estadística and Bank of Spain. Tourism P&S Income Net Lending(+)/Borrowing(-) Current Account (% of GDP) 9

12 Macroeconomic scenario: merchandise exports & imports (I) Merchandise Trade Balance. Energy vs. Non-Energy Goods. ( bn. 12-Month Rolling Sums) Merchandise Trade Balance. By Type of Good. ( bn. 12-Month Rolling Sums) % % 11 9 * Non-energy Balance Energy Balance Balance Intermediate Goods Cons. Goods. Excl. Food Food Capital Goods Source: Instituto Nacional de Estadística and Bank of Spain. Source: Instituto Nacional de Estadística and Bank of Spain. Merchandise Exporting Firms. (Index =1) Number of exporting firms Source: ICEX. * February vs February Regularly Exporting firms 1

13 Macroeconomic scenario: merchandise exports & imports (II) 16% Weight of 2 Major Export Products in Merchandise Exports. 16% Weight of 2 Major Import Products in Merchandise Imports. 14% 12% 1% Weight Last 12 Months Weight in 8% 6% 4% 2% % 11 Motor Vehicles 8.7% Crude Oil 8.% Basic Chem., Fertilizers, Plastics And 6.1% Other Machinery And Equip. 5.9% Clothing 5.4% Parts And Fittings Of Motor Vehicles 5.2% Other Food Products 4.6% Metallurgic & Metallic Products 4.6% Basic Pharmaceutical Products 4.3% Other Electronic, Optical And Electric Prod. 4.2% Agricultural Products 3.3% Other Chemical Products 3.1% Electric Materials And Equipment 2.9% Refined Oil & Coal/Coke 2.7% Metallic Products Excl. Equipment 2.4% Other Goods 2.4% Other Manufactured Goods 2.2% Aircraft And Spacecraft 2.2% Natural Gas 2.1% Plastics 1.8% 14.8% 14% 12% 1% Weight Last 12 Months Weight in Motor Vehicles Refined Oil & Coal/Coke 6.8% Metallurgic & Metallic Products 5.6% Agricultural Products 5.5% Other Machinery And Equip. 5.3% Basic Chem., Fertilizers, Plastics And 4.8% Clothing 4.6% Other Food Products 4.5% Other Chemical Products 3.9% Parts And Fittings Of Motor Vehicles 3.7% Basic Pharmaceutical Products 3.7% Metallic Products Excl. Equipment 3.4% Electric Materials And Equipment 3.1% Other Goods 3.% Aircraft And Spacecraft 2.5% Meat And Meat Products 2.5% Plastics 1.7% Animal And Vegetable Oils And Fats 1.6% 1.6% Leather And Footwear Other Electronic, Optical And Electric Prod. 1.5% 8% 6% 4% 2% % Source: Ministerio de Economía y Empresa.

14 Macroeconomic scenario: merchandise exports & imports (III) Agricultural Products Anthracite, Coal And Lignite Crude Oil Natural Gas Ferrous Metals Meat And Meat Products Animal And Vegetable Oils And Fats Other Food Products Alcoholic Beverages Manufactured Tobacco Clothing Refined Oil & Coal/Coke Basic Chem., Fertilizers, Plastics And Pesticides Other Chemical Products Basic Pharmaceutical Products Ceramic Wares Metallurgic & Metallic Products Metallic Products Excl. Equipment Office Machines And Computers Other Electronic, Optical And Electric Prod. Domestic Appliances Other Machinery And Equip. Motor Vehicles Parts And Fittings Of Motor Vehicles Locomotives And Rolling Stock Other Manufactured Goods Sewerage Services Other Goods Weighted Expansion Indicator Source: Ministerio de Economía y Empresa. Merchandise Trade Balance Position By Product. Smoothed Surplus Deficit 12

15 Macroeconomic scenario: merchandise exports & imports (IV) 1 Year Comparative Merchandise Trade Balance. By Product. ( bn. 12-Month Rolling Sum. Absolute Balance Above 1 bn) Source: Ministerio de Economía y Empresa. 13

16 Macroeconomic scenario: merchandise exports and imports (V) Weight in Merchandise Exports. <.1%.1% -.25%.25%-.5%.5%-1% 1%-2% 2%-5% >5% Weight in Merchandise Imports. <.1%.1% -.25%.25%-.5%.5%-1% 1%-2% 2%-5% >5% Merchandise Exports. 15 Main Countries. Weight in Merchandise Exports Change in Weight Since 25 Year-on-Year Change 1 France Germany Italy Portugal United Kingdom United States Netherlands Belgium Morocco China Turkey Poland Mexico Switzerland Algeria European Union Euro Area Merchandise Imports. 15 Main Countries. Weight in Merchandise Imports Change in Weight Since 25 Year-on-Year Change 1 Germany France China Italy United States Netherlands Portugal United Kingdom Belgium Turkey Morocco Poland Nigeria Brazil Algeria European Union Euro Area Source: DATACOMEX. Source: DATACOMEX. 14

17 15 Macroeconomic scenario: merchandise exports Change in Share in Spanish Merchandise Exports since 25. > -2.% -2% to -1.2% -1.2% to -.7% -.7% to -.3% -.3% to % % to +.5% >+.5% Most Recent Year-on-Year Growth Rates of Spanish Merchandise Exports. >-5% -5% to -2% -2% to % % to 2% 2% to 5% > 5% Source: DATACOMEX.

18 16 Macroeconomic scenario: merchandise imports Change in Share in Spanish Merchandise Imports since 25. > -2.% -2% to -1.2% -1.2% to -.7% -.7% to -.3% -.3% to % % to +.5% >+.5% Most Recent Year-on-Year Growth Rates of Spanish Merchandise Imports. >-5% -5% to -2% -2% to % % to 2% 2% to 5% > 5% Source: DATACOMEX.

19 Macroeconomic scenario: Services Balance Quarterly Balance of Services Other Than Tourism. By Type of Service ( bn) Tourism Tourism (Smoothed) Source: Bank of Spain. Rest of services Rest of services (Smoothed) Quarterly Services Balance. Other Than Tourism. By Type of Service ( bn) Source: Bank of Spain. Personal & Cultural Other Professional Consultancy R&D Other Asia Africa IT Services Intellectual Property Financial Pension & Insurance Construction Transportation Repair Quarterly Services Balance. Other Than Tourism. Breakdown by Region ( bn) Source: Bank of Spain. South America North & Centr. America Rest of Europe Other EU UK France Germany 17

20 Macroeconomic scenario: Net International Investment Position Net International Investment Position. (% of GDP) Valuation Effects NIIP Excl. Val. Effects & BoS NIIP NIIP Excl. Val. Effects Source: Bank of Spain and own calculations. Monetary Policy/Settlement Gross External Debt. By Debtor Sub-Sector. (% GDP) Source: Bank of Spain. Net External Debt. (% of GDP) 99. Gross External Debt. By Debtor Sub-Sector. (Index. =1) 85.2 Direct Investment Other Resident Sectors Bank of Spain Monetary & Financial Institutions Public Administrations Gross external Debt to GDP Source: Bank of Spain. NOTE: Thegross external debt position equals total IIP liabilities excluding all equity (equity shares and other equity) and investment fund shares and fi nancial derivatives and employee stock options. Public Administrations Bank of Spain Direct Investment Source: Bank of Spain. Monetary & Financial Institutions Other Resident Sectors 18

21 Macroeconomic scenario: supply side (I) Gross Value Added. Industry, Construction & Services. (Year-on-Year Growth Rates) Gross Value Added in Services (I). (Year-on-Year Growth Rates) Industry Construction Services Gross Value Added in Services (II). (Year-on-Year Growth Rates) Wholes. & Retail Trade Financial & Insurance Information & Communication Real Estate Professional Services Public Administration, Heatlth & Ed. 19

22 Macroeconomic scenario: supply side (II) Gross Value Added. Industry, Construction & Services. (Index =1) Industry Construction Services Gross Value Added in Services (I). (Index =1) Gross Value Added in Services (II). (Index =1) Wholesale & Retail Trade Financial & Insurance Information & Communication Real Estate Professional Services Public Administration, Heatlth & Ed. 2

23 21 Economic Indicators. General and Industrial Activity Indicators Year-on-Year Growth Rates Unless Otherwise Stated General Activity Aforelast quarter Last quarter PMI (>5 Expansion; <5 Contraction) Q3 Econ. Sentiment (Average=1) Q3 Turnover Q2 Domestic Sales of Big Firms Q2 Car Registrations Q3 Truck Registrations Q2 Electricity Consumption Q3 Aircraft Passengers Q3 Retail Sales Index Q3 Industry Average 23- Yearly Averages Quarterly Averages Industrial Production Index Q2 Manufacturing PMI (>5 expansion; <5 contraction) Q3 Industry Turnover Q2 Industry Turnover. Cons. Goods Q2 Industry Turnover. Capital Goods Q2 Industry Turnover. Interm. Goods Q2 Industrial New Orders Q2 Industrial Capacity Utilisation. Manufactures. (Levels) Q4 Source: Ministerio de Economía y Empresa. #N/A Date of latest data

24 22 Economic Indicators. Services Sector Indicators Year-on-Year Growth Rates Unless Otherwise Stated Construction Aforelast quarter Last quarter Mortgages on Dwellings* Q2 Houses Bought* Q2 General House Price Index* Q2 Services Services Turnover Q2 Services Turnover. Trade Q2 Services Turnover. Transport & Storage Q2 Services Turnover. Hotels & Catering Q2 Services Turnover. IT & Communication Q2 Services Turnover. Prof., Scient. & Tecnhical Q2 Services Turnover. Administration & Auxiliary Services Q2 Services Turnover. Other Services Q2 Number of Tourists Q2 * Since Source: Ministerio de Economía y Empresa. Average 23- Yearly Averages Quarterly Averages Date of latest data

25 Indebtedness of the Private Sector. Debt Levels 22 Private Sector Debt Dynamics. (% of GDP. Non-Consolidated) Spain France Germany Italy Euro area Source: EUROSTAT, Banco de España and Instituto Nacional de Estadística. Non-Financial Corporations' Debt Dynamics. (% of GDP. Non-Consolidated) Households' Debt Dynamics. (% of GDP. Non-Consolidated) Spain France Germany Italy Euro Area Source: EUROSTAT, Banco de España and Instituto Nacional de Estadística Spain France Germany Italy Euro Area Source: EUROSTAT, Banco de España and Instituto Nacional de Estadística. 23

26 Indebtedness of the Private Sector 2 Non-Financial Corporations' Debt Dynamics vs. Investment. (Year-on-Year Growth Rates) 15 Households' Debt Dynamics vs. Consumption. (Year-on-Year Growth Rates) Debt/GDP Gross Fixed Capital Formation Debt/GDP Consumption Source: EUROSTAT, Banco de España and Instituto Nacional de Estadística. Source: EUROSTAT, Banco de España and Instituto Nacional de Estadística Debt Service Ratio. Non-Financial Private Sector Italy Germany France UK Spain Source: BIS. 24

27 25 Residential Real Estate Q4 / Q4 Since Q4 General House Price Index by Region. (Year-on-Year Growth Rates) -28.% -29.% -29.1% -3.6% -31.3% -31.6% -32.7% -32.8% -32.8% -34.2% -34.6% -36.2% -36.6% -37.4% -39.2% -4.2% -42.9% -43.8% -43.9% -44.7% Source: Instituto Nacional de Estadística 5.9% 14.8% 25.1% 9.7% 17.3% 9.6% 6.4% 28.4% 28.4% 5.7% 14.3% 8.1% 23.5% 16.7% 14.7% 9.1% 9.9% 4.9% 43.1% 34.6% -5% -4% -3% -2% -1% % 1% 2% 3% 4% 5% Extremadura Andalucía Melilla Galicia Canarias Murcia, Región de Asturias, Principado de Ceuta Balears, Illes Castilla - La Mancha Comunitat Valenciana Castilla y León National Total Cantabria País Vasco Madrid, Comunidad de Rioja, La Aragón Navarra, Comunidad Foral de Cataluña House Affordability Ratio* & Price to Rent Ratio. (Index. =1) House Affordability Ratio Source: BIS, OECD and Ministerio de Economía y Empresa. *Ratio of House Price Index to Household Adjusted Gross Disposable Income. Price to Rent Ratio

28 Residential Real Estate (II) New Mortgages on Dwellings vs. Mortgage Cancellations. (In%) 6% 4% 2% 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% % Interest Rate on New Mortgages. (% By Type of Reference Used and Year-on-Year Growth Rate) Fixed rate Other Floating Euribor YoY New Mortgages (Rhs) Source: Registradores de España. 6.9% 38.1% 3% 2% 1% % -1% -2% -3% -4% -5% % -2% -4% -6% -8% -1% % More dwellings sold than mortgages on dwellings (Household debt decreases) 36.4% -2-4 % More mortgages on dwellings than dwellings sold (Hosehold debt increases) -6-8 Net New Mortgages on Dwellings vs. Houses Sold. (In %) 26

29 Consumer Price Index Source: EUROSTAT Harmonised Inflation of Consumer Prices. (Year-on-Year Growth Rate) Differential Spain Euro Area Selected Sub-Components of Spanish HICP. (Year-on-Year Growth Rates) Source: EUROSTAT. Core Inflation. (Year-on-Year Growth Rate and Differential) Differential Spain Euro Area Core Inflation (Lhs) Administered prices (Rhs) Energy (Rhs) Source: EUROSTAT. 27

30 LABOUR MARKET 1 UNEMPLOYMENT AND SOCIAL SECURITY REGISTRATIONS PAGE 29 2 EMPLOYMENT CREATION PAGE LONG-TERM: EXPLANATORY FACTORS PAGE 32 4 ACTIVITY& EMPLOYMENT INDICATORS PAGE LABOUR MARKET: OTHER LABOUR MARKET INDICATORS PAGE 35 6 UNIT LABOUR COSTS AND PRODUCTIVITY PAGE 36 7 POPULATION TRENDS PAGE 37

31 Labour Market: Unemployment & Social Security Registration Unemployment Rate. (% of Active Population. Not Seasonally Adjusted) Youth Unemplotment Rate Unemployment Rate Social Security Registrations. (Smoothed. Year-on-Year Growth Rates) Monthly Unemployment Rate. (% of Active Population. Seasonally Adjusted) Source: EUROSTAT General Self-employed Source: Ministerio de Economía y Empresa. 29

32 Labour Market: Employment Creation 1% 8% 6% 4% 2% % 4% 35% 3% Weighted Employment Expansion Indicator. (% of Economic Branches with YoY Expansion in Employment) 35.1% 79.8 Share in the Increase in Employment Creation in the Euro Area in the last FourYears Domestic Service Financial and insurance activities International Organisations Electricity, gas, steam & air conditioning Mining and quarrying Water supply; Waste & Remediation activities Agriculture, forestry and fishing Other Services Real estate activities Public admin & defence; Social Sec. Arts, entertainment and recreation Information & Communication Administrative and support service Construction Transportation & storage Education Wholesale & retail trade; repair of motor vehicles Prof., Scientific & Technical activities Human health and social work activities Manufacturing Accommodation and food services 2,5 2, Changes in Employment by Economic Branch. (Thousands of Persons. Smoothed) 1,996.3 Year-on-Year vs. Q Employment Creation Since Q1. (Thousands of Persons) 25% 2% 15% 1% 5% % Other EA (Derived) Source: EUROSTAT. 26.4% 22.3% 12.7% 3.5% Spain Germany Italy Ireland 1,5 1, Since Q1 Private sector In last 4 Quarters Public sector 3

33 31 Labour Market: Detail of Employment by Economic Branch Year-on-Year Change in Employment by Economic Branch. (Thousands of Persons. Based on Moving Averages) Economic branches Primary Sector Agriculture, forestry and fishing Mining and quarrying Manufacturing Manufacturing & Construction Electricity, gas, steam & air conditioning Water supply; Waste & Remediation activities Construction Wholesale & retail trade; repair of motor vehicles Transportation & storage Accommodation and food services Information & Communication Financial and insurance activities Real estate activities Services Sector Prof., Scientific & Technical activities Administrative and support service Public admin & defence; Social Sec. Education Human health and social work activities Arts, entertainment and recreation Other Services Domestic Service International Organisations Weighted Average Overall Expansion Indicator YoY Growth >% and below 2% Zero or negative YoY growth Expansion (YoY Growth=>2%)

34 Labour Market: Long-Term Unemployment & Explanatory Factors Unemployment Rate by Time in Search for Employment. (Year-on-Year Growth Rates) Average exp. per person () Employed: 11,658 Unemployed: 7,19 Retired: 13,45 Other Inactive: 11, Consumption & Transition from Employment to Unemployment. (YoY Growth Rates & Observed Frequencies*) 5.5% 4% 3% 2% 1% % -1% -2% -3% -4% -5% -6% 5.% 4.5% 4.% 3.5% 3.% 2.5% Below 1Year 1Year-2Years More than 2Years Active pop. Employment Unemployment Contributions to Changes in the Year-on-Year Growth Rate of Unemployment. (Year-on-Year Growth Rate& Contributions) Household Consumption (YoY, LHS) Prob. of Employed to Unemployed (RHS) * Frequency of becoming unemployed in a given quarter of a person who was employed in the previous quarter. Contributions to Changes in Active Population. (Year-on-Year Growth Rate& Contributions) Population >16 Discouraged(-)/Reencouraged(+) Other inactive pop. Active pop

35 Labour Market: Occupation & Activity Rates 8 Occupation Rate, Years. (In %) 85 Activity Rate, Years. (In %) Occupation rate Male Female Activity Rate Male Female Occupation Rate, Years. (Year-on-Year Growth Rates) Activity Rate, Years. (Year-on-Year Growth Rates) Occupation rate Male Female Activity Rate Male Female 33

36 Labour Market: Employment by Duration & Type of Contract Share of Part-Time Employment. (% of Total Employment) Last 4 quarters Average since 22 Netherlands Germany UK Euro Area Ireland France Spain Source: EUROSTAT. Share of Temporary Employment. (% Total Employment) Last 4 Average quarters since 22 Spain Netherlands France Euro Area Germany Ireland UK Source: EUROSTAT Spain. Growth Rate of Employment by Working Time. (Year-on-Year Growth Rate) Part-time employment With temporary contract Full-time employment Spain. Growth Rate of Employment by Contract Duration. 15 (Year-on-Year Growth Rate) With indefinite contract

37 Labour Market: Other Labour Market Indicators Unemployment Rate by Province (% of Active Labour Force) > 3% 25% to 3% 2% to 25% 15% to 2% 1% to 15% 5% to 1% <5% Q3 Q3 6 Unemployment Rate by Educational Attainment (% of Active Labour Force) Tertiary Secondary (2nd Cycle) Secondary (1st Cycle) Primary Illiterate 35

38 Labour Market: Unit Labour Costs & Productivity Real Unit Labour Costs. (Index 1999=1, Smoothed) Real Labour Productivity. (Index 1999=1, Smoothed) Germany Euro Area Spain France Italy UK Germany Euro Area Spain France Italy UK Source: EUROSTAT. Source: EUROSTAT. 8 6 Negotiated Wage Increase vs. Salary Costs. (Year-on-Year Growth Rate) Salary cost per effective working hour Wage Increase Negotiated Source: InstitutoNacional de Estadística and Ministerio de Economía y Empresa. 36

39 37 Population Trends 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% % Population Structure. By Age Group (% in Total) 17% 16% 19% 16% 17% 22% 24% 29% 28% 21% 24% 2% 16% 16% 16% Population Dynamics. By Nationality. (Year-on-Year Growth Rate and Contributions to Growth) < >64 National Foreign Total Population Population & Population Proyections. (Thousands of Persons) Total Foreign Spanish Nationality 22 41, , , , , ,385.8 Q3 46, , , f 46, f 45, f 44,268.1

40 FINANCIAL SECTOR 1 THE FINANCIAL SECTOR: EU COMPARATIVE INDICATORS PAGE CAPITAL RATIOS PAGE ASSET QUALITY RATIOS PAGE PROFITABILITY RATIOS PAGE OTHER INDICATORS AND RATIOS PAGE DOMESTIC FINANCIAL SECTOR INDICATORS PAGE 44-46

41 Financial Sector. International Comparisons: Capital Ratios 25% 2% 15% TIER1 Ratio. (% RWA) 16.% 13.% 25% 2% 15% Capital Ratio. (% RWA) 18.8% 15.% 1% 1% 5% 5% % % 25% 2% 15% 1% 14.5% 11.5% 25% 2% 15% 1% 14.3% 11.1% 5% 5% % % 39 Ireland Finland Belgium Denmark Germany Netherlands EU France Spain UK Italy Portugal Finland Denmark Netherlands France Germany UK EU Ireland Italy Belgium Spain Portugal Ireland Denmark Finland Belgium Netherlands Germany France EU UK Italy Spain Portugal Ireland Denmark Netherlands Belgium Finland Germany UK EU France Italy Spain Portugal Dec-14 Jun-18 Dec-14 Jun-18 Source: EBA. Risk Dashboard Interactive Tool. Source: EBA. Risk Dashboard Interactive Tool. CET1 Ratio. (% RWA) CET1 Ratio, Fully Loaded. (% RWA) Dec-14 Jun-18 Dec-14 Jun-18 Source: EBA. Risk Dashboard Interactive Tool. Source: EBA. Risk Dashboard Interactive Tool.

42 Financial Sector. International Comparisons: Asset Quality Ratios 25% Harmonised NPL Ratio. 25% NPE Ratio. 7% 2% 15% 2% 15% 45.9% 6% 5% 4% 1% 5% 4.81% 4.24% 1% 5% 6.76% 3.65% 3% 2% 1% % Ireland Portugal Italy Euro Area Spain EU Belgium France Denmark Germany Netherlands UK Finland % Ireland Portugal Italy Spain EU France Denmark Germany Belgium Netherlands UK Finland % Dec-14 Jun-18 Dec-14 Jun-18 Reduction (RHS) Source: EBA. Risk Dashboard Interactive Tool. Source: EBA. Risk Dashboard Interactive Tool. 6% 5% 4% 44.2% 45.98% NPL Coverage Ratio. 2% 15% Forbearance. 3% 1% 2% 1% 5% 4.56% 2.3% % % France Spain Italy EU Ireland Belgium Netherlands Portugal UK Denmark Germany Finland Ireland Portugal Spain Italy EU Germany UK Netherlands Denmark Belgium Finland France Dec-14 Jun-18 Dec-14 Jun-18 Source: EBA. Risk Dashboard Interactive Tool. Source: EBA. Risk Dashboard Interactive Tool. See: EBA definitions. the definition of forbearance focuses on concessions extended to debtors who face, or may face, difficulties in meeting payments. Forborne exposures can be identified in both the non-performing and the performing portfolios. 4

43 Financial Sector. International Comparisons: Profitability 15.% 12.5% 1.% 7.5% 5.% 2.5%.% -2.5% -5.% -7.5% Finland 8.92% Spain Belgium Return on Equity. 7.22% Ireland France UK Netherlands EU Denmark Germany Italy Portugal 8% 7% 6% 5% 4% 3% 2% 1% % Germany France Ireland Cost-to-Income Ratio % UK Belgium Netherlands Italy EU Portugal Denmark Finland 51.77% Spain Dec-14 Jun-18 Dec-14 Jun-18 Source: EBA. Risk Dashboard Interactive Tool. Source: EBA. Risk Dashboard Interactive Tool. 1.%.8%.6%.4%.2%.% -.2% -.4%.65% Spain Ireland Finland Return on Assets..48% Belgium France UK EU Netherlands Denmark Dec-14 Jun-18 Germany Italy Portugal 8% 7% 6% 5% 4% 3% 2% 1% % Netherlands Net Interest Income to Operating Income. 7.9% 56.83% Ireland Denmark Belgium Spain UK EU Finland Germany Italy France Dec-14 Jun-18 Portugal Source: EBA. Risk Dashboard Interactive Tool. Source: EBA. Risk Dashboard Interactive Tool. 41

44 Financial Sector. International Comparisons: Other Indicators (I) 4% 35% 3% 25% 2% 15% 1% 5% % Denmark Finland Germany Loan-to-Deposits Ratio. Italy Ireland Dec-14 Netherlands 116.2% 113.7% EU Spain Jun-18 France Belgium Portugal UK 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% % Ireland Portugal 5.36% 5.12% Spain Italy Leverage Ratio. UK Sep-16 Finland EU Belgium Jun-18 France Germany Denmark Netherlands Source: EBA. Risk Dashboard Interactive Tool. Source: EBA. Risk Dashboard Interactive Tool. 25% Debt to Capital Ratio. 6% Asset Encumbrance Ratio. 2% 15% 1% 5% % Finland Germany Denmark Netherlands Belgium Dec-14 France % EU UK Italy Jun-18 Portugal 1282.% Spain Ireland 5% 4% 3% 2% 1% % Denmark Germany Ireland 25.35% 28.4% Spain Italy Belgium EU Portugal France Dec-14 Jun-18 UK Finland Netherlands Source: EBA. Risk Dashboard Interactive Tool. Source: EBA. Risk Dashboard Interactive Tool. Encumbered assets of an institution and collateral received by the institution re-used and therefore encumbered over total assets and collateral received 42

45 Financial Sector. International Comparisons: Other Indicators (II) Risk Weighted Assets by Type of Risk. 1% 9% EU Spain 8% 7% 6% 5% 4% 3% 2% 1% % % Credit Risk 86.73% 1.9% Securitisation.56% 6.27% Market Risk 2.86% 1.45% Operational Risk 9.34% 2.22% Other.51% Source: EBA. Risk Dashboard Interactive Tool.

46 Financial Sector. Domestic Indicators (I) Loan-to-Deposits & Equity to Assets. (In %) % 5% 45% 4% 35% 3% 25% Coverage of Domestic NPLs (Excl. Financial & Public Sectors). (In %) % Domestic Lending (Excl. Fin. & Public Sectors) to Deposits (LHS) Equity to Assets (RHS) Source: Bank of Spain. Coverage Ratio Source: Bank of Spain. Domestic NPLs -Excl. Fin. & Public Sectors- 14% 13% 12% 11% 1% 9% 8% 7% 6% 5% 4% Domestic NPLs (Excl. Financial & Public Sectors). (In%) 13.62% 1.55% NPL Ratio at constant Loans 6.4% 4.2% 5% 25% % -25% -5% Breakdown of theyear-on-year Change in the Domestic NPL Ratio Change in Doubtful Loans -Excl. Financial & Public Sectors- (Numerator) Mixed Effects (Not Assignable to Numerator or Denominator) Change in Loans (Denominator) YoY Growth of Domestic NPLs (Excl. Financial & Public Sectors) 5.5% 2.6% -24.% -32.1% Source: Bank of Spain. Source: Bank of Spain. 44

47 Financial Sector. Domestic Indicators (II) 1,3 1,2 1,1 1, Effective Credit Stock. Non-Financial Corporations. ( bn) Effective Credit Stock. Houserholds. ( bn) Non-resident Credit Institutions' loans Securities other than Shares Loans, off-balance-sheet securitised loans & other Source: Bank of Spain. Effective Credit Stock. Non-Financial Corporations. (Contributions and Year-on-Year Growth Rates) -.22 Source: Bank of Spain Loans, off-balance-sheet securitised loans & other. Other Purposes Loans, off-balance-sheet securitised loans & other. Housing Effective Credit Stock. Households. (Contributions and Year-on-Year Growth Rates) Non-resident Credit Institutions' loans Securities other than Shares Loans, off-balance-sheet securitised loans & other Year-on-Year Growth Rate Source: Bank of Spain. Loans, off-balance-sheet securitised loans & other. Other Purposes Loans, off-balance-sheet securitised loans & other. Housing Year-on-Year Growth Rate Source: Bank of Spain. 45

48 Financial Sector. Domestic Indicators (III) 25% % New Loans to Non-Financial Corporations. (Year-on-Year Growth Rates) 1.6% 7.6% 5.1% 6% 4% 2% % New Loans to Households. (Year-on-Year Growth Rates) 21.2% 18.9% 3.1% -25% -2% -4% -5% -6% Source: Bank of Spain. 3% 25% 2% 15% 1% 5% % -5% Total Loans Loans < 1mn Loans > 1mn 9% 75% 6% 45% 3% 15% % -15% Source: Bank of Spain. House purchase Consumption Other Domestic NPLs -Excl. Financial and Public Sectors-vs. Deposit-Taking Institutions: Bankruptcy Proceedings and Unemployment Employees and Branches 28, (Year-on-Year Growth Rates) 27,855 26, 24, 22, 2, 18, , , ,472 5, 45, 4, 35, 3, 25, Domestic NPLs -Excl. Financial & Public Sectors- YoY (LHS) Bankrupt Firms YoY (LHS) Unemployed YoY (RHS) Source: Bank of Spain. Source: Bank of Spain. Employees (LHS) Branches (RHS) 46

49 FUNDING PROGRAMME 1 THE SPANISH TREASURY'S FUNDING PROGRAMME IN PAGE THE FUNDING PROGRAMME IN PAGE MAIN METRICS PAGE INDEX-LINKED BOND PROGRAMME PAGE BOND HOLDINGS STATISTICS PAGE SYNDICATED DEALS IN AND PAGE ESM LOAN PAGE 54 2 RATINGS PAGE 55

50 48 Spanish Treasury: Funding Programme (In billon euros and in effective terms) End Total Net Issuance Total Gross Issuance Medium- and Long-term Gross Issuance Amortisation Net Issuance Letras del Tesoro Forecast Gross Issuance Amortisation Net Issuance Includes debt in other currencies, Bonos y Obligaciones, loans and assumed debts bn Funding Programme in * (Gross issuance, bn.) 85.6% bn Total Medium- & Long-Term Letras Projected Maximum 89.3% Executed 84.4 bn 79.8% Source: Ministerio de Economía y Empresa. *As of 6 Nov

51 Spanish Treasury: Main Metrics Cost of Debt Outstanding and Cost at Issuance (In percent) Average Life of Debt Outstanding. (In percent) Cost of Debt Outstanding * Cost at Issuance * 1% 8% 6% 4% 2% % Marginal Life at Issuance of Bonos and Obligaciones. (In percent) * Average Life at Issuance of Bonos and Obligaciones. (In percent) * < >15 Source: Ministerio de Economía y Empresa. *As of 6 Nov 49

52 Spanish Treasury: Inflation-Linked Bonds 6 Spanish Linker Supply, Auctions & Syndications. (In bn lhs, bps rhs) 6 2,5 Share of Inflation-Linked Bonds in Total Outstanding. (In bn & percent ) bn bps 2, 1,5 1, 5 5.4% 4.% 7.% 4.1% 7.6% 6.% Spain Italy France Germany Syndications Auctions Auction Tails (rhs) Total outstanding of which EMU HCPI National CPI Outstanding Inflation-Linked Bonos and Obligaciones. (In mn) Bonos Obligaciones del Estado indexed to European inflation Reference Index Harmonised index of consumer prices excluding tobacco for the Eurozone Reference Index Maturity Outstanding Date Years amount (mn ) SPGBei.55% 3/11/ , SPGBei.3% 3/11/ , SPGBei.15% 3/11/ ,79.94 SPGBei 1.8% 3/11/ , SPGBei.65% 3/11/ ,95.61 SPGBei 1.% 3/11/ , SPGBei.7% 3/11/ ,6.72 TOTAL 55, Source: Ministerio de Economía y Empresa. *As of 6 Nov Total Outstanding Inflation Debt- breakdown by issuer. (In Percent of Total Inflation-Linked) Spain Italy France Germany 33.8% 17.1% 13.7% 35.5% 5

53 51 Spanish Treasury: Holdings of Letras & Bonos and Obligaciones del Estado 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% % Percentual Structure of Holders (% and bn) 5% 45% 4% 35% 3% 25% Aug 3.5% ( bn) Non-Residents (% and bn) Aug 44.5% ( 422. bn) Non-residents Bank of Spain Spain Ex. Bank of Spain 25% 2% Bank of Spain (% and bn) Aug 22.3% ( bn) 4% 35% Resident Credit Institutions (% and bn) 15% 1% 5% % 3% 25% 2% 15% Mar 34.97% ( 213. bn) Aug 16.8% ( bn) Source: Bank of Spain. (- IBERCLEAR data / - Securities Holdings Statistics)

54 Spanish Treasury: Syndicated Deals in JANUARY -NEW 1 YEAR REFERENCE. APR. 227 Geographic Distribution (%) By Type of Investor (%) FEBRUARY - NEW 15 YEAR REFERENCE. JUL. 233 Geographic Distribution (%) By Type of Investor (%) APRIL -NEW 1 YEAR EURO AREA INFLATION- LINKED REFERENCE. NOVEMBER 227 Geographic Distribution (%) By Type of Investor (%) JUNE- NEW 1 YEAR REFERENCE. OCT 227 Geographic Distribution (%) By Type of Investor (%) Source: Ministerio de Economía y Empresa. 52

55 53 Spanish Treasury: Syndicated Deals in JANUARY -NEW 1 YEAR REFERENCE. APR. 228 Geographic Distribution (%) By Type of Investor (%) JUNE -NEW 1 YEAR REFERENCE. JUL. 228 Geographic Distribution (%) By Type of Investor (%) FEBRUARY- NEW 3 YEAR REFERENCE. OCT. 248 Geographic Distribution (%) By Type of Investor (%) SEPTEMBER- NEW 15 YEAR EURO AREA INFLATION- LINKED REFERENCE. NOV 233 Geographic Distribution (%) By Type of Investor (%) Source: Ministerio de Economía, y Empresa.

56 54 Spanish Treasury: amortisation of the ESM Loan Date Disbursements ( mn) Amount Source: Ministerio de Economía y Empresa. Repayments ( mn) Cumulative Amount Outstanding ( mn) Outstanding (% of Total Loan) 11/12/ 39,468 39, % 5/2/ 1,865 41,333 1.% 8/7/ 1,34 1,34 4, % 23/7/ 38 1,612 39, % 17/3/ 1,5 3,112 38, % 14/7/ 2,5 5,612 35, % 11/11/ 1, 6,612 34, % 14/6/ 1, 7,612 33, % 16/11/ 2, 9,612 31, % 23/2/ 2, 11,612 29, % 23/5/ 3, 14,612 26, % 16/1/ 3, 17,612 23, % Outstanding Amounts of the ESM for the Recapitalisation of the Spanish Financial Sector (In bn) Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec Dec-18

57 55 Spanish Treasury: Ratings Aaa/AAA/AAA 16 Aa1/AA+/AA H Aa2/AA/AA 14 Aa3/AA-/AA L A1/A+/A H 12 A2/A/A 1 A3/A-/A L Baa1/BBB+/BBB H Baa2/BBB/BBB 8 Baa3/BBB-/BBB L Ba1/BB+/BB H 6 (rating) Rating and Rating Actions vs. End-of-Month Spread to 1Y Bunds (basis points) Announced Rating Dates in. Fitch S&P DBRS Moody's January 19 February March 23 April 6 13 May June July 13 August September October 5 November December MOODY'S S&P FITCH DBRS Risk Premium (rhs) Source: Ministerio de Economía y Empresa.

58 DEFICIT AND DEBT 1 FISCAL ADJUSTMENT PATH - PAGE 57 2 FISCAL POLICY -22 PAGE 58 3 COMPARATIVE METRICS PAGE 59 4DEBTTOGDPRATIO PAGE6 5 REGIONAL FINANCES PAGE 61 6 BUDGETARY EXECUTION PAGE 62

59 57 Fiscal policy: - Net Lending(+)/Borrowing. (% of GDP) * * Central Government Autonomous Regions Local Governments Social Security Financial Sector One- Offs General Government General Government Ex Financial Sector One-Offs Memorandum items Interest Expenditure Revenue Expenditure * Figures affected by the Negative impact of the Settlement System. Excluding the impact of the Settlement System Autonomous Regions' deficit was.55% of GDP lower in and 1.77% of GDP in. In the case of Local Governments the impact of the Settlement System amounted to.13% of GDP in and to.39% of GDP in. Both yearly amounts would add to the headline Central Government figures. Source: Ministerio de Economía y Empresa and Ministerio de Hacienda.

60 58 Fiscal policy: Fiscal Path -221 Net Lending(+)/Borrowing. (% of GDP) Source: Ministeriode Economía y Empresa, Ministerio de Hacienda, AMECO and IMF are the projections contained in the Budgetary Stability Objectives released in July. Forecast Central Government Autonomous Regions Local Governments Social Security General Government Primary Balance #N/A #N/A Memorandum items f 219f 22f 221f Structural Balance (AMECO Database) Structural Balance (IMF) NAWRU (AMECO Database)

61 Change vs. 59 Greece Ireland Portugal Spain United Kingdom Slovak Republic Netherlands Japan Australia Malta Slovenia Austria France New Zealand Belgium Italy United States Germany Canada Korea Denmark Luxembourg Finland Sweden Estonia Norway Fiscal policy: Comparative Metrics Primary Balance. f vs.. (pp of GDP) Change vs. Greece Portugal Spain United Kingdom United States Slovak Republic Japan Slovenia Netherlands Australia Austria France New Zealand Finland Italy Denmark Canada Estonia Germany Belgium Malta Luxembourg Sweden Korea Norway # NUM! Source: IMF. WEO April. Structural Balance. f vs.. (pp of GDP) Source: IMF. WEO April.

62 Fiscal policy: Debt Dynamics General Government Debt. EDP. (% of GDP) Actual Forecast Source: Bank of Spain and Ministerio de Economía y Empresa. Projections contained in the Draft Budgetary Plan Monthly General Government Debt Indicator. EDP. (% of GDP) Total EDP Debt (RHS) State (LHS) Other Central Gov't (LHS) Regional Gov'ts (LHS) Local Gov'ts (LHS) Social Sec. Funds (LHS) Consolidation (LHS) Source: Bank of Spain Interest-to-Revenue and Interest-to-GDP Ratios. (In%) Interest to Revenue Ratio Source: Ministerio de Economía y Empresa. 3.6 Interest to GDP Ratio Monthly General Government Debt Indicator. EDP. (Year-on-Year Growth Rate) Total EDP Debt (RHS) State (LHS) Other Central Gov't (LHS) Regional Gov'ts (LHS) Local Gov'ts (LHS) Social Sec. Funds (LHS) Consolidation (LHS) Source: Bank of Spain

63 Fiscal policy: Regional Finances bn Cataluña Extremadura Comunitat Valenciana Región de Murcia Aragón Baleares Source: Ministerio de Hacienda Budgetary Execution. Regions. (% of GDP) Cantabria Castilla-La Mancha Asturias Castilla y León C. Foral de Navarra Comunidad de Madrid La Rioja Andalucía País Vasco Galicia Canarias Debt to GDP Ratiosand Composition of Regional Debt. 42 ( bn and % of GDP) Valencia Castile-La Mancha Catalonia Balearic Islands Balearic Islands Extremadura Cantabria Aragon Andalusia Castile-Leon La Rioja Asturias Galicia Navarre Canary Islands Madrid Basque Country Debt Securities Loans by Resident Banks Loans by the FLA/FF PPPs Loans by Non-Residents Debt to GDP Ratio (RHS) Source: Bank of Spain. Debt to GDP Ratio Autonomous Community Source: Ministerio de Hacienda. GDP (Weight in national GDP) Total Liquidity Measures mn (-) % in total Liquidity Measures CATALUÑA 19.% 7, % C. VALENCIANA 9.4% 53, % ANDALUCIA 13.3% 35, % CAST. LA MANCHA 3.4% 14, % MURCIA 2.6% 9, % BALEARS (ILLES) 2.6% 9, % GALICIA 5.2% 6,979 3.% CANARIAS 3.8% 6,62 2.9% CASTILLA - LEON 5.% 5,7 2.2% MADRID 18.9% 4,729 2.% ARAGON 3.1% 4,627 2.% EXTREMADURA 1.6% 3, % CANTABRIA 1.1% 2,96 1.3% ASTURIAS 1.9% 2, % RIOJA (LA).7% 686.3% PAIS VASCO 6.2%.% NAVARRA 1.7%.% TOTAL mn 231,37 61

64 Fiscal policy: Budgetary Execution Quarterly Budgetary Execution. By Subsector. (In pp of Rolling Nominal GDP) Financial Sector One-Offs Social Security Central Government Source: Ministerio de Hacienda. Local Governments Autonomous Regions General Government Ex. Financial Sector Monthly Budgetary Execution. By Subsector, ExcludingLocal Governments. (In mn) Central Government Financial Sector One- Offs Balance ( mn.) Central Govt. Excl. Fin. Sector Regions Social Security Total CG+Regions +Soc. Sec. ( mn.) Total CG+Regions+ Soc. Sec. Excl. Fin Sector ( mn.) Year-on-Year change -38,151-1,35-36,81-18,5-1,763-67,414-66,64-1.8% -29, ,294-18,71-13,38-61,585-61,33-7.6% -29,632-2,387-27,245-9,629-17,72-56,981-54, % -22, ,528-4,231-16,775-43,42-42, % Aug. -21, , ,991-28,55-27, % Aug. -2, ,164 1,689-5,199-23,611-23, % Source: Ministerio de Hacienda.

65 More information on the Spanish Economy National Statistics Institute Includes all relevant short-term and structural statistics generated by the National Statistics Authorities. The Spanish Economy Contains a collection of relevant reports on economic outlook, public finances, public debt, the financial sector and reform initiatives. Ministry for the Economy and Business Includes the latest economic forecasts and reports as well as a database with over 21, short-term and long-term indicators and macroeconomic aggregates. Intervención General de la Administración del Estado Contains all relevant information on the economic & financial activity of the public administrations (Budgetary execution, Budgets and planning, etc.). Bank Spain Compiles and provides monetary, banking and financial statistics, interest rates, balance of payments. Also contains useful tools for statistical analysis of time series data, among other features. AIREF The purpose of the Independent Authority for Fiscal Responsibility (AIReF, as it is known in Spanish) is to oversee the sustainability of public finances as a means for ensuring economic growth and the wellbeing of the Spanish society in the medium and long-term.