Banco de Portugal | March 2025 issue of the Economic Bulletin

The Portuguese economy will grow by 2.3% this year, before slowing down to 2.1% and 1.7% in 2026 and 2027.
This pace will continue to outperform the euro area average, benefiting in 2025-26 from easing financial conditions, accelerating external demand and a more concentrated rate of implementation of European funds next year. Behind the lower growth in 2027 is the end of the Recovery and Resilience Plan (RRP). 

Inflation will decline to 2.3 % in 2025 and stabilise at 2% in the following two years, benefiting from more contained growth in services prices. Inflation will remain volatile in 2025, with quarterly figures projected to stand between 1.9% and 2.6%.

Investment will accelerate in 2025-26, driven by improving financing conditions, demand and the flow of European funds. The RRP is projected to stagnate in 2027. 

Exports will grow at an average pace of 2.9% in 2025-27, below their recent levels, against a background of growing foreign demand, but with a loss of momentum in services and lower market share gains. With the inflow of European funds, the economy’s net lending will reach historically high levels.