Lisbon, Nov. 17, 2025 (Lusa) - Inflation in Portugal is expected to slow to 2.2% this year and 2% next year, according to the autumn economic forecasts released by the European Commission on Monday, which also projects a drop in the unemployment rate.

Inflation, measured by the harmonised price index, which allows comparisons between countries, "fell to 2% in the second quarter of 2025, but rose slightly to 2.3% in the third quarter, driven by a notable increase in unprocessed food prices," the document reads.

Despite the rise in food prices, inflation in services continued to slow, as well as in energy and industrial goods, allowing the rate to decelerate.

For 2025 as a whole, inflation is estimated at 2.2%, falling to 2% in 2026 and 2027. Underlying inflation, excluding energy and food, is expected to remain slightly higher, the Commission estimates.

Concerning the unemployment rate, Brussels points out that, “despite some moderation in tourism, job creation picked up pace during the summer of 2025, contributing to a gradual decline in the unemployment rate to a 12-month average of 6.3% in August 2025, compared to 6.5% in 2024”.

"Both demand for and supply of labour increased at a rapid pace, pushing the employment rate to new historic highs in the second and third quarters of 2025," it says, but "employment growth is expected to moderate somewhat over the forecast horizon, while unemployment is expected to fall gradually to an annual average of 6.1% in 2027."

The projections are for unemployment rates of 6.3% in 2025, 6.2% in 2026, and 6.1% in 2027.

As for wages, they "should continue to rise faster than GDP, but the corresponding increase in unit labour costs should moderate slightly, largely in line with developments in the main trading partners," the Commission predicts.

In the proposed State Budget for 2026, the government forecasts an unemployment rate of 6.1% this year and 6% in 2026.

MES // CSJ

Lusa/Fim