Portugal economy at a glance

Latest figures for Portugal: inflation, growth, interest rates, jobs, bond yields, debt and taxes. Updated 6 November 2026. Open Portugal on the interactive map →

Key figures

Indicator	Latest	Period	Previous
Inflation (consumer prices, year on year)	3.9%	October 2026	3.6% September 2026
Core inflation (excluding food and energy)	3.1%	October 2026	2.9% September 2026
Real GDP growth (year on year)	2.4%	Q3 2026	2.6% Q2 2026
Policy rate (European Central Bank)	2.50%	November 2026	2.50% October 2026
Unemployment rate	5.6%	September 2026	5.6% August 2026
10-year government bond yield	3.85%	September 2026	3.54% August 2026
Retail sales (year on year)	−0.2%	September 2026	1.8% August 2026
Industrial production (year on year)	−2.6%	September 2026	−1.8% August 2026
Wages (year on year)	5.4%	Q2 2026	5.3% Q1 2026
House prices (year on year)	16.5%	Q2 2026	17.8% Q1 2026
Stock market (PSI)	9,483	November 2026	+16.9% over 12 months

Questions and answers

What is the inflation rate in Portugal?

Portugal's annual inflation rate was 3.9% in October 2026, up from 3.6% in September 2026.

What is the interest rate in Portugal?

The European Central Bank deposit facility rate is 2.50% (as of November 2026). The next rate decision is due on 17 December 2026.

How fast is Portugal's economy growing?

Portugal's real GDP grew 2.4% year on year in Q3 2026. The IMF's October 2026 World Economic Outlook forecasts growth of 2.1% in 2026 and 1.9% in 2027.

What is the unemployment rate in Portugal?

Portugal's unemployment rate was 5.6% in September 2026, unchanged from August 2026.

What is Portugal's 10-year government bond yield?

Portugal's 10-year government bond yield averaged 3.85% in September 2026.

How much government debt does Portugal have?

Portugal's government debt is about 89.2% of GDP (latest annual figure), with a budget surplus of 0.7% of GDP.

What is Portugal's credit rating?

Portugal's sovereign credit ratings: S&P A+, Moody's A3, Fitch A+.

What is the VAT rate in Portugal?

Portugal's standard VAT rate is 23% (2026 rules).

What is the corporate tax rate in Portugal?

Portugal's corporate income tax rate is 29.5% (2026 rules).

Who leads Portugal?

Portugal is led by Prime Minister Luís Montenegro (PSD), heading a minority Democratic Alliance (PSD/CDS-PP) government; President António José Seguro (head of state, in office since 9 March 2026). Next election: No national vote scheduled; next legislative election due by 2029, next presidential election in 2031.

Outlook

The Banco de Portugal (October bulletin) raised its 2026 growth forecast to 2.3% and sees 1.8% in 2027, with inflation easing from 3.1% to 2.4%. The government's budget assumes 2.3% and 2.0%, a 0.1% of GDP surplus in 2027 and debt falling to 84.5% of GDP, while the IMF is a bit lower at 2.1% and 1.9%. The central bank sees growth risks to the downside and inflation risks to the upside, mainly from a Middle East escalation or a sharp AI- or fiscal-driven market correction, with overheated housing (prices up 16.5% y/y) and the end of EU recovery funds after 2026 as domestic risks and further rating upgrades as the main upside.

Why Portugal matters for the world economy

Portugal's direct global weight is small, and its spillovers run mainly through Spain, which buys about a quarter of its goods exports, and through tourism, its biggest services export. It is building a role as an Atlantic energy and data gateway: the Sines port and LNG terminal, renewable power, green-hydrogen projects and large data-centre investments. In markets, its shift to budget surpluses and falling debt has pushed its 10-year yield (3.85% in September) below those of France and Belgium, so it now serves as a benchmark of fiscal repair in the euro periphery. Its historic links to Brazil, Angola and Mozambique make it a channel for trade, finance and migration with the Portuguese-speaking world.

Politics

Montenegro's centre-right minority government, re-elected in May 2025, depends on either the Socialists (PS) or the far-right Chega to pass legislation. Its labour-law reform was voted down in June 2026 after two general strikes, but the 2027 budget submitted on 8 October looks safe because the PS will abstain in the 28 October vote after the PM accepted four of its conditions. With former Socialist leader António José Seguro elected president in February 2026 (67% against Chega's André Ventura), political risk to the fiscal surplus is low, a record that helped earn Fitch's upgrade to A+ in September.

System: Semi-presidential parliamentary republic.

Economy and taxes

GDP: US$347 billion
Population: 10.8 million
Government debt: 89.2% of GDP
Budget balance: 0.7% of GDP
Current account: 1.2% of GDP
Exports: 43.7% of GDP
Main exports: Motor vehicles and parts, refined petroleum products, electrical machinery and equipment, clothing, textiles and footwear, cork, paper and pulp, plastics, wine and food; tourism dominates services exports
Top export markets: Spain (26.0%), Germany (13.9%), France (12.0%), United States (5.8%), United Kingdom (4.5%)
IMF growth forecast: 2.1% in 2026, 1.9% in 2027
IMF inflation forecast: 3.2% in 2026, 3.0% in 2027
Currency: EUR
Freelancer tax: A self-employed person earning the average wage (EUR 27,768 a year) pays about 29.4% of it in income tax and social contributions (2026 rules)
Top income tax rate: 53.0%
Gold reserves: 382.7 tonnes (July 2026)
Energy self-sufficiency: 21% (2024)

Recent news

4 November 2026 Portuguese inflation rises to 3.9% in October Eurostat
Eurostat's flash estimate put Portugal's annual inflation at 3.9% in October, up from 3.6% in September, as inflation across the euro area climbed to 4.0%.
30 October 2026 Portugal's growth slows to 0.2% in the third quarter as exports fall Trading Economics
Statistics Portugal's flash estimate showed GDP up 0.2% on the quarter and 2.4% on the year, slower than the 0.9% and 2.6% of the second quarter. Falling exports dragged on growth, while domestic demand held up and investment rebounded.
28 October 2026 Parliament passes the 2027 budget in its first vote as the Socialists abstain RTP
The 2027 budget passed its general vote with support from PSD and CDS-PP, while the Socialists, PAN and JPP abstained and Chega, IL, Livre, PCP and BE voted against. Detailed votes run from 18 to 23 November, with the final vote on 24 November.
27 October 2026 Budget debate opens amid housing protests, with Socialists set to let it pass ECO
Parliament began the general debate on the 2027 budget, with the first vote due on 28 October. The PS will abstain, making approval likely, but housing protests and the police clearance of protest camps in Lisbon and Porto dominate the political mood.
26 October 2026 Fiscal watchdog calls Portugal's budget targets plausible ECO
The Public Finance Council projects a 0.1% of GDP surplus this year and a 0.1% deficit in 2027, close to the government's plans, and sees debt falling to 83.3% of GDP. Its projection leaves out some expected revenues and higher defence spending, which could still shift the result.
8 October 2026 2027 budget tabled with Socialist abstention securing its passage Euronews / Lusa
The government's budget forecasts growth of 2.3% in 2026 and 2.0% in 2027, a 0.1% of GDP surplus and debt falling to 84.5% of GDP. It cuts corporate tax to 18% and trims income-tax rates. The PS will abstain in the 28 October first vote, and the final vote is set for 24 November.

Headlines and summaries are compiled daily from the linked reports with AI assistance.