IMF hikes 2017 growth forecast for Spain

The International Monetary Fund (IMF) on Tuesday raised its 2017 growth forecast for Spain, citing strong exports, a rebound in consumer demand and a booming tourism sector.

The IMF now expects the eurozone's fourth-largest economy to grow by 3.1 percent this year, compared with its April forecast of 2.6 percent.

The Washington-based body said it could not rule out that the growth could be even higher than its latest estimate as a result of the "momentum" created by the government's economic reforms.

It predicted the Spanish economy will expand by 2.5 percent in 2018, up from a previous IMF forecast of 2.1 percent.

"Spain's economic recovery remains strong, with consumption, investment, and net exports all contributing to a more balanced growth pattern," the IMF said.

"A dynamic services sector, much of which is export-oriented, has replaced an outsized construction sector, and together with a recovery in manufacturing contributed to the sustained improvements in the current account balance."

Spain's economy grew by 3.2 percent in 2016 and in 2015 as it recovered from a severe crisis caused in part when a property bubble burst in 2008.

Tourism, which accounts for around 11 percent of Spain's economic output, has benefited from a surge in visitor numbers as security concerns in some other rival Mediterranean holiday destinations such as Turkey and north Africa diverted tourists to the country.