Portugal's economic recovery has taken a turn for the worse, and fixed investment will remain weak on the back of increasing policy uncertainty and weak global demand.
The large corporate and government debt loads and precarious credit market conditions will remain a major impediment to an acceleration of growth.
Portugal's Socialist Party-led minority government will become increasingly unstable as it walks an ever tighter rope between fulfilling demands for fiscal prudence by its bailout creditors and demands for better workers' rights by domestic labour unions.
We have revised down our average annual real GDP growth forecasts for 2016-17 to 1.0% from 1.5% previously.
We have revised down our forecasts for the euro exchange rate, and now project the currency to continue its multi-year depreciation towards parity against the US dollar.
A reversal of the reform path under the ruling Socialist Party and the two radical left-wing parties that will support the minority government, i.e. the Left Bloc and the Socialist Party, poses risks for political stability and market perceptions of the sovereign risk profile.
|Real GDP growth, % y-o-y||0.9||1.5||1.0||0.9|
|Nominal GDP, EURbn||173.4||179.4||187.5||193.0|
|Consumer price inflation, % y-o-y, eop||-0.3||0.3||1.2||1.5|
|Exchange rate EUR/USD, eop||0.82||0.92||0.95||0.96|
|Budget balance, % of GDP||-7.2||-4.4||-3.2||-3.2|
|Current account balance, % of GDP||0.1||0.4||-0.1||0.0|
Assess your risk exposure in Portugal with our 100% independent forecasts assessing the pace and stability of this key market. Backed by trusted data from BMI Research's 52 million data point economic forecast model, this report will allow you to measure political, economic, business environment and operational risks in Portugal with confidence.
Your subscription service includes:
- Delivery of the report in print and PDF
- Online access for 12 months
- The functionality to translate your online report into your choice of 10 languages - Arabic, Chinese, French, German, Italian, Japanese, Korean, Portuguese, Russian and Spanish
- The ability to export data and graphs from the online report directly into your workflow
- The support of a dedicated Account Manager to answer any questions you might have about your subscription
- Access to our team of leading analysts who will be happy to answer any questions you might have about the data and forecasts included in this report