Spain's Economy Downsizes

Spain's economy contracted 0.4% in the first quarter from the fourth, the country's central bank said Monday, the latest evidence that Spain's efforts to rein in government spending could be feeding a downward economic spiral.

The central bank numbers, released about a week before the government's official data, confirm that Spain is far from a much-needed economic rebound—in which government austerity measures have damped growth, which could in turn make it tougher for Madrid to achieve ambitious austerity targets.

On an annual basis, the economy contracted 0.5%, the first negative reading after seven consecutive quarters of modest annualized growth,…

http://online.wsj.com/article/SB10001424052702303459004577361312778286258.html?mod=WSJ_hp_LEFTWhatsNewsCollection