Spain’s Deficit Struggle Shows Threat to ECB Rally
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Spain’s bid to meet its budget-deficit target for the first time in five years is running into trouble, fueling concerns that increased financial stability is masking deeper economic problems.
The shortfall for the central government in the first seven months of the year was 4.38 percent of Spanish output, compared with a 3.8 percent goal for the year, government data show. Economists at the savings banks’ foundation Funcas, Mizuho International and Bank of America Merrill Lynch said Spain may miss the European Union’s overall goal for this year of 6.5 percent as benefit spending climbs and tax income falters.