Spain falls deeper into recession upping pressure on PM Rajoy

PanARMENIAN.Net - Spain fell deeper into recession in the third quarter, upping the pressure on Prime Minister Mariano Rajoy as he seeks more austerity measures and considers requesting a eurozone-led bailout, CNNMoney reports.

Preliminary central bank figures for the quarter released Tuesday showed the Spanish economy shrank by 0.4% compared to the March-June period, with contractions occurring in both government and household spending. Year-over-year, the economy contracted by 1.7% in the three months ended Sept. 30, compared with 1.3% in the second quarter.

Spain, the eurozone's fourth largest economy, is stuck in its second recession in three years. Both the government and the International Monetary Fund are predicting further contraction next year, although they differ on the scale.

Unemployment has risen to record levels around 25%, putting Spain on a par with Greece, and sparking angry protests at the waves of spending cuts and tax increases introduced by the government to reduce debt.