The Portuguese economy continues reducing its debt for the third month in a row, totaling 721 billion euros. It is the lowest amount in six months.
The Portuguese economy’s indebtedness fell in November for the third month in a row. Data from the Bank of Portugal about that month reveal that the debt of the non-financial sector fell more than 600 million euros in comparison to October, setting a new minimum since May. The deleveraging took place especially on the public sector, with the debt reimbursement to the International Monetary Fund (IMF).
After having reached a maximum record in August, above 724 billion euros, the non-financial public sector, companies and families have been reducing their indebtedness. In November, the amount of debt ascended to 720.8 billion euros.
“Compared with October 2017, non-financial sector indebtedness decreased by €0.6 billion, due to a €1.6 billion fall in public sector indebtedness, partly offset by a €1.0 billion increase in private sector indebtedness”, the Bank of Portugal explains, in a note disclosed this Monday.
As for the reduction of public indebtedness, November was the month in which Portugal made a 2.8 billion euros’ reimbursement to IMF because of the financial aid granted in 2011, and this largely explains the economy’s deleverage in November of 2017. Public debt totaled 242.8 billion euros in November.
As for the private sector, the one billion euros’ increase is explained by “a €0.8 billion increase in external indebtedness of private corporations and a €0.2 billion increase in the indebtedness of households and corporations vis-à-vis the financial sector”.