The Banco de España Business Activity Survey: 2024 Q1

Rationale The Banco de España Business Activity Survey (EBAE) provides highly valuable, real-time information on a broad sample of Spanish firms’ turnover, employment, costs and prices. This is particularly helpful for diagnosing current economic developments. Takeaways •Firms perceived a decline in their turnover in 2024 Q1, albeit with considerable cross-sector heterogeneity. •Overall, the results show that investment activity has performed worse in the first quarter of the year compared both with the preceding quarter and with what firms expected for this quarter three months ago. •Business activity continues to be shaped by uncertainty over economic policy (which remains the main conditioning factor) and by a growing concern over labour shortages (associated with greater expected rises in labour costs), and also appears to have felt the impact of the recent geopolitical tensions in the Red Sea.