Portugal Economic Outlook
October 27, 2020
The economy should have recovered somewhat in Q3, although the fallout from the pandemic continued to weigh on activity. Available data shows that industrial production returned to growth in August after declining in July. Moreover, in July–August retail sales shrank at a softer pace than in Q2. However, tourism revenues were still down severely in the same two-month period. Turning to Q4, a surge in cases and implementation of some new restrictions in mid-October bodes ill for activity. In other news, on 12 October the government submitted the draft 2021 budget to parliament. The plan sees a reduction in expenditure to 47.8% of GDP (2020: 49.9%), due to a reduced need for fiscal support as the economy rebounds. The budget aims to strike a balance between supporting the recovery—the government will boost investment and subsidies for lower-income workers—and containing the fiscal deficit.Portugal Economic Growth
The economy is seen rebounding next year, as the effects of the pandemic dissipate, providing room for the return of demand through recovering tourism and household consumption. Investment should also recover on decreasing uncertainty. Delays in implementing a vaccine and a possible prolonged health crisis pose downside risks to the outlook. FocusEconomics Consensus Forecast panelists see GDP growing 5.5% in 2021, which is down 0.1 percentage points from previous forecasts. For 2022, the panel sees it climbing 3.4%.Portugal Economy Data
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Portugal Facts
| Value | Change | Date | |
|---|---|---|---|
| Bond Yield | 0.45 | -1.90 % | Jan 01 |
| Exchange Rate | 1.12 | 0.65 % | Dec 31 |
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Portugal Economic News
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Portugal: Industrial output rebounds in March
April 30, 2021
Industrial output increased 5.0% year-on-year in seasonally-adjusted terms in March, which contrasted February's 2.8% decrease.
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Portugal: Economy records sharpest contraction since Q2 2020 in Q1
April 30, 2021
According to a preliminary reading, GDP dropped 3.3% on a seasonally-adjusted quarter-on-quarter basis in the first quarter, contrasting the 0.2% expansion seen in the fourth quarter of last year and marking the sharpest downturn since Q2 2020.
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Portugal: Consumer and business sentiment improve in April
April 29, 2021
Consumer sentiment shot up to minus 17.1 in April, above March’s minus 20.2 and logging the best reading in over a year.
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Portugal: Consumers turn less pessimistic in March; business sentiment deteriorates further
March 30, 2021
Consumer sentiment fell to minus 20.2 in March, notably below February’s minus 25.8 and logging the best reading in a year.
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Portugal: Decline in industrial activity softens in February
March 30, 2021
Industrial output dropped a seasonally-adjusted 2.4% compared to the same month a year earlier in February, moderating from January’s 6.2% plunge.
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