Bank of Spain raises 2026 inflation forecast due to Middle East war Spain’s central bank raised its inflation forecast Thursday, citing higher energy prices from the Middle East war, but left its economic growth projections unchanged for now. The Bank of Spain now expects inflation to reach 3.6 percent this year, up from a previous forecast of 3.0 percent. Despite the higher inflation outlook, the central bank left its growth forecasts unchanged, projecting gross domestic product growth of 2.3 percent this year and 1.7 percent
in 2027, rates it said would remain well above those expected across the eurozone. Socialist Prime Minister Pedro Sánchez’s government unveiled in March dozens of measures worth five billion euros ($5.8 billion) to cushion households and businesses from the economic fallout of the conflict. The central bank said its revised inflation projections reflected “a context of partial pass-through” of higher energy prices to the broader economy. However, it said the recent agreement between the United States and Iran had improved prospects for energy markets and
helped ease some risks to the outlook. Spanish king to visit Mexican president as ties improve Spain’s King Felipe VI will visit Mexican President Claudia Sheinbaum on June 25th during a World Cup trip in another sign of the countries’ diplomatic thaw, the royal palace said on Thursday. The monarch will then continue to Guadalajara where he will attend Spain’s World Cup group-stage match against Uruguay the following day, the palace said. Diplomatic relations had been strained since 2019, when Mexico demanded that the Spanish
crown apologise for abuses committed during the conquest and colonisation of the Americas in the 16th century. Sheinbaum excluded the king from her inauguration in October 2024 partly because Spain had not responded to the demand. Tensions have eased since the king in March acknowledged that there had been “a lot of abuse” during the conquest of the Americas. Heatwave to start this weekend The arrival of a very dry and warm Saharan air mass, combined with abundant sunshine, will bring us very high and
persistent temperatures this weekend, marking the first official heatwave of the summer in Spain. Temperatures will remain high on Friday and keep rising on Saturday, reaching 40C in cities such as Zaragoza, Lleida, Córdoba, Jaén, Ciudad Real, and Toledo. The mercury will be in the high 30s in most of Spain on Sunday, but surpass 40C in Andalusia, Extremadura, Castilla-La Mancha, Madrid and Aragón. Some isolated thunderstorms are expected in Asturias, Galicia and Castilla y León. Court orders Spain to pay €2.5 million for wrongfully
imprisoned man Spain’s Supreme Court has ordered the State to pay Ahmed Tommouhi €2.5 million in compensation for the miscarriage of justice that led to him spending 15 years in prison (and an additional three years) on parole for rapes he did not commit. The high court acquitted him of two counts of sexual assault for which he had been convicted by the Barcelona Provincial Court because he was identified in a police lineup, but his semen was not the same as that found on
the victims’ underwear. The court considers that the judicial error committed was “unequivocal and qualified” as they did not factor in a DNA test from the victim’s clothing which didn’t belong to the accused.
Spain, Bank of Spain, inflation forecast, Middle East war, energy prices, heatwave, Saharan air mass, World Cup, Mexico, Claudia Sheinbaum, King Felipe VI, Supreme Court, Ahmed Tommouhi, wrongful imprisonment, DNA test, compensation