UPDATE 1-Spain inches back to growth in third quarter - cenbank

Wed Oct 23, 2013 2:10pm IST

MADRID Oct 23 (Reuters) - Spain's economy expanded slightly in the July-September period, the Bank of Spain forecast on Wednesday, with strong exports pulling the country out of a two-year recession.

Spanish gross domestic product grew 0.1 percent in the second quarter from a quarter earlier, when the economy contracted by the same degree. GDP shrank 1.2 percent in the third quarter from a year earlier, the central bank said in its monthly bulletin, after falling 1.6 percent year on year a quarter earlier.

Spain's economy has shrunk, or has been stagnant, every year since 2008 when a burst housing bubble left millions out of work, forced a deep financial sector rehaul and left thousands of companies bankrupt.

"The slight recovery in activity in the third quarter after the fall a quarter earlier is due to ... a more favourable contribution from the external sector," the Bank of Spain said in its monthly bulletin.

The National Statistics agency INE is due to report preliminary GDP data for the third quarter Oct. 31 followed by a full breakdown of economic output Nov. 28.

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