Bank of Portugal lowers forecast for economic growth for 2016 and 2017

31 March 2016

The Bank of Portugal has lowered its economic growth forecasts for 2016 by 20 basis points to 1.5 percent and for 2017 by one-tenth of a percentage point to 1.7 percent compared to previous figures, according to a report released Wednesday.

The document entitled “Projections for the Portuguese economy: 2016-2018” for the first time includes indicators for 2018, with the central bank projecting an economic growth rate of 1.6 percent.

The forecasts for 2016 and 2017 take into account the measures included in the state budget for 2016 the Bank of Portugal said adding that the scenario is “surrounded by several downside risks,” including the possibility of lower growth in activity and international trade flows as well as new tensions in financial markets.

The document restated some of the constraints on the Portuguese economy, such as high private and public indebtedness, adverse demographic trends, distortions in labour and product markets, an inadequate level of investment and the decline in growth in the main markets for Portuguese exports.” (macauhub/PT)