Portugal GDP

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Portugal: GDP accelerates in Q4; economy expands for the first time in three years in 2014

February 27, 2015

GDP expanded a seasonally-adjusted 0.5% in Q4 over the previous quarter, according to detailed data published by Statistics Portugal on 27 February. The expansion came in above the 0.3% increase tallied in Q3. On an annual basis, the economy grew 0.7% in Q4, which was below the 1.1% rise recorded in the previous quarter and marked the lowest result since Q3 2013.

The expansion tallied in Q4 was driven by strong export growth, which more than offset a contraction in domestic demand. Private consumption expanded a meager 0.2% in the final quarter of the year, which was well below the 1.4% rise tallied in Q3. Government consumption contracted for the second consecutive quarter in Q4, declining 0.2% (Q3: -0.4% quarter-on-quarter). Finally, fixed investment swung from a 2.5% expansion in Q3 to a 0.2% fall in Q4, contributing strongly to the lackluster performance in domestic demand.

Exports of goods and services rose 3.3% over the previous quarter in Q4, which was a strong acceleration compared to the mild 0.7% rise tallied in Q3 and marked the highest result since Q2 2013. Meanwhile, imports decelerated from a 3.1% increase to a 1.0% rise. As a result of the acceleration in exports and the slowdown in imports, the external sector’s net contribution to overall growth swung from minus 1.0 percentage points in Q3 to plus 0.9 percentage points in Q4.

In the full year 2014, the economy grew 0.9%, which contrasted the 1.3% contraction observed in 2013 and marked the first year of expansion since 2011.

The Bank of Portugal expects the economy to expand 1.5% in 2015 and 1.6% in 2016. FocusEconomics Consensus Forecast panelists expect GDP to expand 1.5% in 2015, which is unchanged from last month’s projection. For 2016, the panel foresees the economy growing 1.7%.


Author:, Economist

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Portugal GDP Q4 2014

Note: Year-on-year and annual average variation in %.
Source: Statistics Portugal (INE) and FocusEconomics calculations.


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