Nomura projects Portuguese economy to grow at an average rate of 1.6 pct until 2017

18 September 2015

Portugal’s economy should continue to expand at a steady average rate of about 1.6 percent until 2017, bolstered by domestic demand, according to Japanese investment house Nomura.

The economic growth forecast is similar to the government’s forecast for 2015 but more moderate for the next two years, with Portugal’s ruling coalition forecasting the economy will consolidate recovery this year and that growth will increase to 2 percent in 2016 and 2.4 percent in the following three years.

The Japanese firm said in a research note that despite the likely scenario of Portugal having a minority government after the elections of 4 October, the systemic political risk in the country is low, limiting the impact that any uncertainty may have on debt markets.

“The Portuguese recovery continues to be driven by domestic demand and in particular household consumption,” said Nomura, quoted by Reuters news agency, adding that its sees the government’s goal of the public deficit for 2015 as “optimistic”.

Meanwhile, Portugal returned Wednesday to the primary debt market with two auctions of treasury bills, one at three months and another over 11 months, and the Treasury funded itself at a three month maturity at negative interest rates, with a rate of – 0.013 percent.

The Portuguese Treasury Management and Public Debt Agency (AGTDP) intended to issue between 750 million and 1 billion euros and the amount raised exceeded forecasts and totalled 1.15 billion euros. (macauhub/PT)