Portugal: GDP contracts in fourth quarter
February 14, 2011
In the fourth quarter, GDP contracted a seasonally and working day adjusted 0.3% over the previous quarter, according to the first estimate released by Statistics Portugal on 14 February. The reading, which was in line with analysts' expectations, contrasted the 0.2% expansion recorded in Q3 and marked the first negative reading in 12 months. The contraction in Q4 was impacted by public sector cutbacks, which curbed consumer spending. Moreover, the decline was somewhat alleviated by an increasing net contribution from the external sector to overall economic growth. Compared to the same quarter the year before, the economy grew 1.2%, inching down from the 1.3% year-on-year rise recorded in the third quarter. Based on quarterly figures, the Portuguese economy expanded 1.4% in the full year 2010, partly recovering from the 2.5% contraction recorded in 2009. A more complete set of data for Q4 national accounts will be released on 11 March.