European Central Bank Vice President Luis de Guindos described the increase in house prices as “one of the main difficulties” facing the Spanish economy, and urged… Solve the rent bottleneck and invest in social services So that the country can grow in terms of per capita income and wealth. The number “two” of the issuer launched this message within the framework of the 24th Congress held by the Spanish Confederation of Directors and Executives (CEDE) on Thursday in Zaragoza under the slogan Europe: from diagnosis to action.
The former Economy Minister stressed that although new housing construction takes much longer, there will be room for more short-term measures in the rental market, where a strong increase in demand is converging. With a regulation that “restricts” the supply of rental housing It causes this increase in prices, which also happens in other European countries and which prevents further movement in the labor market.
“I think there should be an effort there. For me, that is the first priority.”De Guindos, who also called for increased investment in social services, declared that population growth also has implications for demand and thus populist and fragmented approaches will be avoided. The increase in migration flows must be accompanied by an increase in resources in this area.
“If we can solve this bottleneck and the issue of social services, I am convinced that Spain will continue to grow not only from the point of view of GDP, but even from the point of view of GDP per capita.” More than the EurozoneIt has been settled. The Bank of Spain has already positioned immigration as one of the main drivers of the economy, by strengthening the labor market, while the National Institute of Statistics has confirmed that the Spanish population will reach historic levels, exceeding 49.4 million as of October 1, 2025.
The risks facing the European economy
Regarding the state of the euro economy, de Guindos believes that the labor market is in a good position, as the unemployment rate has reached the lowest historical level since the establishment of the euro (it reached 6.3% in the euro area, according to Eurostat), and stressed that Job creation continues, although not at the intensity it was a year or two ago. This is when inflation remains very close to the entity’s price stability target of 2%.
He stressed, “We believe that the level of interest rates is appropriate based on the development of inflation and its expectations, and what is very important is the transmission of these monetary policy decisions to families and companies.” De Guindos noted that in the financial stability report it published this week, the entity identified three vulnerabilities.
The first is high valuations in both equities and fixed income. He warns that markets are assuming that geopolitical risks will not materialize, that the United States will continue to cut interest rates, and that there will be no global recession. “The danger is that if this laudable vision is not then realized We could have a fairly intense correction in prices“This is more due to the fact that there is a significant concentration in large US technology companies, especially institutional investors.
The second risk identified by researchers is fiscal policy and rising public debt (on average 90% in Europe), at a time when it has become necessary to increase defense spending. He said: “We have a threat, which is the Russian threat. We have an American administration that we can describe as more volatile, and it is clear that the European approach must be modified and we must spend significantly more on defense and do that relatively well.”
The ECB Vice-President noted that the move from 2% to 3.5% of GDP in defense spending would have an impact from a budget point of view on all countries, increasing the “instability” due to which some European governments have difficulties in approving their budgets. He explained, “It is not just about voting every four years, but it is about respecting the separation of powers, respecting minorities, and freedom of the press…” The former Spanish minister believes that the situation in Europe politically is complicated due to severe fragmentation.