The Portuguese economy is losing speed in the third quarter, according to the CIP/ISEG Economic Situation Barometer published on Wednesday, which predicts “the same trajectory” for the last quarter of the year, which is “worrying news”.
In summary, tourism revenues are slowing, there is weak nominal service sector revenue growth and a contraction in manufacturing and “only cement consumption has improved,” according to the CIP/ISEG Economic Barometer conclusions.
The barometer “thus indicates a chain growth in the third quarter ‘between slightly positive and slightly negative’, and predicts the same trajectory for the fourth quarter – which is worrying news for the Portuguese economy, which is going through a clear moment of cooling.” , the statement reads.
The development of net external demand, “also in terms of chain development, is likely to remain negative, ‘as the value growth of tourism revenues slows down significantly compared to the previous quarter’s growth,'” he states.
The barometer warns of a “recessive external environment that will necessarily harm the growth of the Portuguese economy through external demand”, i.e. “the increase in interest rates by the European Central Bank [BCE] is causing a drag on the eurozone, which will impact growth forecasts for this year and next year, which will impact the state budget to be presented next week.”
‘The forecast for annual GDP growth [produto interno bruto] in 2023 it has now been revised downwards to a range between 2.0% and 2.4%, with 2.1% corresponding to a situation of stagnation until the end of the year,” he adds.
“The signs are of contraction in industry, growth in construction – indicated by increased cement consumption, which is good news –, relatively stable and moderate retail sales growth and weak nominal retail sales growth the services sector, another red flag that should be taken into account in the next public policy that the government will present,” the CIP/ISEG barometer said.
“The slowdown of the national economy is underway, as the CIP predicted before the summer. The CIP/ISEG Barometer confirms this beyond any doubt, as do other indicators that the CIP has collected from business people,” says CIP President Armindo Monteiro. cited in a statement.
“Machine sales, which serve as a kind of advanced indicator of the economic environment, have lost momentum in recent months as entrepreneurs prepare for a more difficult or even unfavorable scenario in 2024,” he continues, as “the government must and protect businesses without hesitation and this must be made very clear in OE2024.”
Source: DN
