Lisbon, June 24, 2026 (Lusa) - The International Monetary Fund (IMF) has on Wednesday once again revised downwards its growth forecast for the Portuguese economy, from 1.9% to 1.7% this year, in its Article IV report.

This projection represents a downward revision compared with the estimate in the April World Economic Outlook (WEO), which had itself already been revised down by 0.2 percentage points from the figure given in October last year.

It is also below the government’s forecast, which, in the annual progress report sent to Brussels at the end of April, had predicted a 2% increase in Gross Domestic Product (GDP) this year.

The IMF team emphasises that the negative effects of the war in the Middle East are expected to offset the impact of increased funding from the European Union.

Furthermore, “severe storms hampered growth at the start of the year, but reconstruction and repairs are expected to boost activity later on, so the annual impact of the storms should be broadly neutral”, it notes.

For 2027, the IMF now forecasts growth of 1.6% in Portugal, and 1.8% for 2028, according to the updated forecasts released today by the institution.

“The further slowdown expected in 2027 mainly reflects the end of investment funded by the Recovery and Resilience Plan (PRR),” it explains.

Inflation (measured by the Harmonised Index of Consumer Prices), meanwhile, is expected to rise to 3.4% in 2026, driven by rising commodity prices and, to a lesser extent, wage pressures, before falling back to 2.3% in 2027.

MES/AYLS // AYLS

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