Central bank expects Portuguese economy to grow by 1.2 percent in 2014

27 March 2014

The Bank of Portugal has revised its projections for growth of the Portuguese economy upwards for 2014 and 2015. It now forecasts growth of 1.2 percent in 2014 and 1.4 percent in 2015, according to the central bank’s Spring Bulletin.

In the Winter Bulletin the Bank of Portugal said it expected the Portuguese economy to grow by 0.8 percent in 2014 and 1.3 percent in 2015.

The forecast rate of growth for this year is the same as the government’s projection and the projection that resulted from the 11th evaluation of Portugal’s financial bailout package by the three-way commission (European Commission, European Central Bank and the International Monetary Fund).

For 2015, the Bank of Portugal now expects growth of 1.4 percent, compared to a previous projection of 1.3 percent, which is lower than the 1.5 percent rate forecast by the government and the three-way commission.

For the first time the central bank also put forward a projection for 2016, of 1.7 percent growth. For 2014 and 2015 the Bank of Portugal did not consider any additional austerity measures that the government may apply.

The Bank of Portugal’s new projections are based on a rise in consumption, which this year is expected to grow by 1.3 percent compared to a previous projection of 0.3 percent, and investment is expected to contract.

Exports are expected to increase by more than previously expected at 5.4 percent this year compared to a projection of 3.9 percent previously and are expected to grow at rates of over 5 percent in 2015 and 2016, the central bank said. (macauhub)