MADRID, April 28 (Xinhua) -- Spain's Vice-President and Economy Minister Carlos Cuerpo on Tuesday warned that the ongoing conflict involving the United States and Israel against Iran could shave between 0.4 and 1.0 percent off the country's GDP in 2026, while pushing inflation higher.
Speaking after the weekly cabinet meeting, Cuerpo said the Bank of Spain estimates a central scenario of around a 0.8 percent hit to economic growth.
He added that inflation could rise by around 1 percentage point, bringing average inflation for the year to around 3.1 percent.
The warning comes as Spain's annual inflation already rebounded to 3.4 percent in March, driven largely by rising energy prices, highlighting the economy's sensitivity to external shocks.
"The high level of uncertainty is forcing analysts to work with scenarios rather than forecasts," Cuerpo said, warning that the economic outlook would deteriorate the longer the conflict continues.
Despite the risks, he stressed that Spain is relatively better positioned than many other countries, citing its diversified energy mix and strong presence of renewable sources, which have helped contain electricity price increases compared with most European peers.
