Portugal: 2019 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Portugal

IMF Staff Country Reports, July 12, 2019

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Canonical URL: Portugal: 2019 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Portugal

After a strong performance in 2017, economic activity moderated.
The second half of 2018 was marked by a deceleration, coinciding with weaker economic activity in Europe.
The headline fiscal balance improved, with a small increase in the structural primary balance reflecting a strict budget execution.
The current account turned negative in 2018 in conjunction with a deterioration of the balance of trade in goods and services.
Total credit to the nonfinancial private sector continued to decline in 2018.
Over the last 4 years the Portuguese banking system has been strengthening its balance sheet and its performance.

Economic growth: strong in 2017, moderated in 2018.
2018 H2: deceleration aligned with weaker activity in Europe.
Current account: turned negative in 2018 driven by deterioration of the balance of trade in goods and services.

Headline fiscal balance: improved in the period covered.
Structural primary balance: experienced a small increase, attributed to strict budget execution.

Total credit to the nonfinancial private sector: continued to decline in 2018.
Banking system: strengthening of balance sheets and performance documented over the last 4 years.

Subject: Banking, Credit, Financial institutions, Fiscal policy, Fiscal stance, Labor, Loans, Money, Public debt
Keywords: asset quality, balance sheet risk, consumer price inflation, core FSIs, CR, Credit, deficit, Europe, Fiscal stance, GDP, Global, ISCR, legacy asset, Loans, output gap, Portugal, potential GDP, private sector, Q4, supervision framework bill