Economy set to grow 6.7% this year and 1.2% in 2023

Portugal’s Council of Public Finances (CFP) is optimistic that the country’s economy will grow 6.7% this year and fall back to 1.2% next year.

However, the CFP also foresees that inflation will reach 7.7% this year and 5.1% in 2023.
The public institution headed by Nazaré Costa Cabral published its forecasts for the Portuguese economy to 2026.
The forecasts are based on a macroeconomic scenario based on invariant policies, which means they don’t take government measures for the State Budget 2023 into account.
The growth forecast of 6.7% is above the government’s forecast of 6.4%.
The CFP says its forecasts are supported “in large measure by a strong performance in exports in the first half of the year and strong private consumption, benefitting from significant savings which are above the historic average”.
For 2023, it’s a different story. The CFP predicts more timid GDP growth of just 1.2%, “owing to continuing inflationary pressures, with negative consequences for private consumption and a slowing of overseas economic activity”. For this year the CFP predicts an inflation rate of 7.7% and 5.1% for the next.