Spain's Industrial Output Growth Slows Sharply in June

Spain's industrial output growth slowed to 1.1% in June compared to the same month last year, down from a revised 3.4% annual increase in May, according to data released by the National Statistics Institute (INE). This marks the second consecutive month of deceleration in the year-on-year rate.

The decline was broad-based, with consumer goods and capital goods production both contracting compared to the previous month. On a month-to-month basis, industrial output fell by 0.8% in June, reversing the 0.7% gain recorded in May.

Economists note that the calendar-adjusted figure provides a clearer picture of underlying trends. The decline in capital goods production is particularly concerning, as it points to reduced business investment, a critical driver of long-term productivity.

The data may influence the European Central Bank's policy stance as it balances inflation control with supporting growth. A sustained slowdown in industrial activity could add pressure on the ECB to consider rate cuts later this year, although inflation remains above the 2% target.