Portugal Economic Outlook
October 27, 2020The 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 GrowthThe 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 Economic News
Portugal: Second estimate confirms economy rebounded sharply in Q3, but strong momentum will not carry into Q4
November 13, 2020
A second GDP estimate released by the National Statistics Institute on 13 November showed the economy rebounded 13.3% in seasonally-adjusted quarter-on-quarter terms in Q3, after contracting 13.9% in Q2.
November 2, 2020
Industrial output increased 2.9% in year-on-year terms in September, which was a deterioration from August's 4.2% increase.
October 30, 2020
A GDP estimate released by the National Statistics Institute on 30 October showed the economy rebounded 13.2% in seasonally-adjusted quarter-on-quarter terms in Q3, after contracting 13.9% in Q2.
October 29, 2020
Consumer sentiment rose to minus 24.6 in October, from minus 26.6 in September.
September 30, 2020
Industrial production expanded 3.0% year-on-year in August (July: -8.8% yoy).