Publications

Colombia's economy will grow 2.6% in 2026 and 2.1% in 2027 driven by private consumption, amid global geopolitical tensions and cautious monetary policy. Activity faces challenges from weak investment, persistent inflation, and fiscal sustainability pressures.

Headline inflation remained at 3.2% year-on-year, mainly due to the deceleration of energy and food prices. However, core inflation ticked up to 3.0%. BBVA Research estimates that headline inflation could increase to 3.6% or 3.7% in June.

Headline inflation in Spain accelerated to 3.4% YoY in March, driven by energy and, to a lesser extent, by services and industrial goods. In fact, core inflation rose unexpectedly to 2.9%. BBVA Research estimates that headline inflation could rise to 3.6% or 3.7% in April.

The Spanish economy is expected to grow by around 2.4% annually in 2026 and 2027, although with a heterogeneous regional landscape. Growth will be led by tourism- and service-oriented areas this year, while industrial regions could recover in 2027 thanks to stronger European demand.

The balance of 2025 showed economic resilience in the face of geopolitical tensions, supported by lower inflation and investment. The war in the Middle East is a supply shock, whose impact will depend on how long it lasts and how oil prices evolve.

Despite slightly higher growth and inflation forecasts, Lagarde struck a cautious tone, stressing high uncertainty and avoiding forward guidance. The ECB is watching services inflation and wages and starting to assess AI’s impact. Barring surprises, a prolonged pause with the deposit rate at 2% through 2027 looks likely.

Spain is growing faster than the EU (around 3% in 2025) and has the lowest unemployment rate since 2008 (10.5%), but productivity growth is disappointing and still lags behind the EU. More investment (in physical, technological, and human capital) is needed for more productive, innovative, and sustainable growth.