Second Spanish election may not end political deadlock

Significance

Polls suggest that, although there may be some changes in party performance from the general election in December 2015, it is likely that again no party will win a majority and a coalition will need to be formed.

Impacts

• A weak government may fail to take initiatives in response to the economic slowdown.
• Ongoing political deadlock may hit international business confidence in Spain.
• It is unlikely that the election will give rise to a viable government initiative to break the impasse over Catalonia.