Slowdown in the eurozone might induce Portuguese GDP to fall to 1%

  • ECO News
  • 28 March 2019

The Portuguese central bank (BdP) has downwardly revised the economic growth in the country, worried that the slowdown in the eurozone will make GDP grow by 1.6% or only 1%.

Besides the downward revision of the economic growth, which was already rather more pessimistic than the one announced by the government, the Portuguese central bank now alerted for the risks that the underperformance of the main economies in Europe poses to the country’s economy. In the best of scenarios, the Portuguese economy will grow by 1.6%, and the BdP’s worst expectations are that GDP grows merely by 1%, less than half of the government’s estimates.

The economy is indeed slowing down, and the government has recognized it already. Mário Centeno, interviewed by SIC, a Portuguese news channel, announced a downward revision of the GDP growth, at 2% — the value he expects for April when he delivers the Stability Programme in Brussels.

“The impact we are projecting at the moment, even as the Portuguese economy in the first quarter is performing much better than it was in the previous quarter, is a relatively acceptable update, identical to the one we had in the GDP revision at the end of last year. The difference is two tenths. I do not want us to get stuck at 2%. It can be 2.1%, it can be 1.9%…” he noted.

In the Bulletin published this Thursday, Banco de Portugal revised its projection for the economic growth to 1.7% in 2019, adding a text where it calculates the impact on the Portuguese economy of this slowdown to extend beyond the expected.