PARIS: The International Monetary Fund warned yesterday that the Spanish recession would be worse than initially expected, with a forecast contraction of 1.7 percent this year and of 1.2 percent in 2013.

In addition, the IMF said that worsening market tension could disrupt Spain’s ability to finance itself, despite a eurozone bailout agreed for Spanish banks and emergency financial reforms for the 17-nation bloc.

“Market tensions could intensify further, threatening market access, particularly if policies fail to stem capital outflows or due to further stress elsewhere in the euro area,” the IMF said in a report on the eurozone’s fourth biggest economy.

The Daily Sun/Bangladesh/ 29th July 2012