IMF upgrades 2023 growth forecast to 1.0% but inflation seen at 5.7%
In its latest World Economic Outlook, released on Tuesday, the IMF predicts that Portugal's GDP will expand by 1.0% this year and 1.7% in 2024, marking an upgrade from its October forecasts, of 0.7%.
The International Monetary Fund on Tuesday upgraded its forecast for growth in Portugal’s gross domestic product this year, to 1.0%, but is more pessimistic about the inflation rate, which it expects to average 5.7%.
In its latest World Economic Outlook, released on Tuesday, the IMF predicts that Portugal’s GDP will expand by 1.0% this year and 1.7% in 2024, marking an upgrade from its October forecasts, of 0.7% for this year and 2.4% next.
The IMF’s forecast for this year is in line with those of the European Commission and the Organisation for Economic Cooperation and Development (OECD) but is below the 1.3% pencilled into the 2023 budget by the government – which may yet be updated in its Stability Programme, to be submitted to the commission by 15 April – and the 1.2% forecast by Portugal’s Public Finance Council (CFP), a budget watchdog, and the 1.8% of the Bank of Portugal (BoP).
The IMF also predicts that consumer price inflation in Portugal will average 5.7% this year and 3.1% in 2024, when in October it had forecast 4.7% and 2.6% respectively.
The forecast for this year is above the 4.0% foreseen by the government, but closer to the 5.4% estimated by the European Commission, the 5.5% forecast by the Bank of Portugal and the 5.9% of the CFP; it is below the OECD’s forecast of 6.6%.
The IMF also predicts that the jobless rate in Portugal will rise from 6.0% in 2022 to 6.6% in 2023 and 6.5% in 2024.
According to the new forecasts, the IMF also sees Portugal’s current account deficit shrinking from 1.3% of GDP last year to 0.8% this year and 0.7% in 2024.
