World

Spanish central bank says economy shrank 0.5 percent in Q1 for 7th quarterly contraction

  • A man looks at a bird as he sits in the square in Madrid, Spain, Monday, April 22, 2013.  The 2012 figures from Eurostat, the European Union's statistics office, showed Monday that in spite of efforts to get a handle on its debts, Spain saw its budget deficit rise to 10.6 percent of GDP in 2012 from 9.4 percent the year before as the country took US dlrs 52 billon (40 billion euro) in rescue loans to help its banks. Excluding the rescue funds, Spain says its deficit last year improved to just under 7 percent, above the initially pledged target of 6.3 percent. (AP Photo/Andres Kudacki)

    A man looks at a bird as he sits in the square in Madrid, Spain, Monday, April 22, 2013. The 2012 figures from Eurostat, the European Union's statistics office, showed Monday that in spite of efforts to get a handle on its debts, Spain saw its budget deficit rise to 10.6 percent of GDP in 2012 from 9.4 percent the year before as the country took US dlrs 52 billon (40 billion euro) in rescue loans to help its banks. Excluding the rescue funds, Spain says its deficit last year improved to just under 7 percent, above the initially pledged target of 6.3 percent. (AP Photo/Andres Kudacki)  (The Associated Press)

  • A man uses an ATM machine as a homeless man begs for alms from his makeshift bed in Madrid, Spain, Monday, April 22, 2013. The 2012 figures from Eurostat, the European Union's statistics office, showed Monday that in spite of efforts to get a handle on its debts, Spain saw its budget deficit rise to 10.6 percent of GDP in 2012 from 9.4 percent the year before as the country took US dlrs 52 billon (40 billion euro) in rescue loans to help its banks. Excluding the rescue funds, Spain says its deficit last year improved to just under 7 percent, above the initially pledged target of 6.3 percent. (AP Photo/Andres Kudacki)

    A man uses an ATM machine as a homeless man begs for alms from his makeshift bed in Madrid, Spain, Monday, April 22, 2013. The 2012 figures from Eurostat, the European Union's statistics office, showed Monday that in spite of efforts to get a handle on its debts, Spain saw its budget deficit rise to 10.6 percent of GDP in 2012 from 9.4 percent the year before as the country took US dlrs 52 billon (40 billion euro) in rescue loans to help its banks. Excluding the rescue funds, Spain says its deficit last year improved to just under 7 percent, above the initially pledged target of 6.3 percent. (AP Photo/Andres Kudacki)  (The Associated Press)

Spain's central bank says the recession continued in the first three months of the year, with the economy shrinking by 0.5 percent, its seventh quarterly contraction.

The bank said Tuesday that the drop was somewhat milder than the 0.8 percent contraction in the final quarter of 2012. Compared with a year earlier, the economy was 2 percent smaller in the first quarter.

The bank blamed a continuing fall in consumer spending, which dropped 0.8 percent in the first quarter. The unemployment rate is 26 percent.

The bank has predicted the economy will contract 1.5 percent this year and only return to growth in late 2014.

The central bank's figures are an independent estimate. The official figures by the national statistics agency will be reported on April 30.