## Portugal: Selected Issues

_IMF Staff Country Reports, June 22, 2023_

## Source details

**Canonical URL:** [Portugal: Selected Issues](https://www.imf.org/en/publications/cr/issues/2023/06/21/portugal-selected-issues-535043)

## Other formats

- [Markdown version](/en/publications/cr/issues/2023/06/21/portugal-selected-issues-535043/index.md)
- [Structured JSON version](/en/publications/cr/issues/2023/06/21/portugal-selected-issues-535043/index.json)
- [Bundle manifest](/en/publications/cr/issues/2023/06/21/portugal-selected-issues-535043/bundle-manifest.json)

## Bibliographic details
- Published: June 22, 2023
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400246104.002

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### Overview
- Title: Portugal: Selected Issues
- Publication date on landing page: June 22, 2023
- Series: IMF Staff Country Reports 2023, 219
- Pages: 51
- DOI: https://doi.org/10.5089/9798400246104.002
- ISBN: 9798400246104
- ISSN: 1934-7685
- Subject tags provided: Employment, Financial institutions, Housing prices, Inflation, International organization, Labor, Labor markets, Monetary policy, Mortgages, Prices
- Keywords provided: aggregate labor market dynamics, C. inflation projection, Employment, employment share, Europe, Global, HICP inflation weight, Housing prices, Inflation, Labor markets, Mortgages, wage-inflation spiral

### Inflation dynamics and drivers (findings)
- Inflation in Portugal has been below average euro area (EA) levels but strongly correlated with the rest of the EA.
- Inflation picked up slowly in 2022H1, reflecting delayed pass through from international commodity prices to headline inflation, and accelerated quickly in 2022H2.
- Inflation in Portugal is determined by similar factors as in other advanced economies (AE) countries.

### Model-based forecasts, sensitivity analysis, and scenarios
- The analysis provides a model-based forecast of headline and core inflation using assumptions from the January 2023 World Economic Outlook.
- The paper conducts sensitivity assessment, including evaluation of risks of developing a sustained wage-price inflation spiral under current circumstances.
- Simulations analyzing potential risks indicate:
  - Inflation could increase further with shocks.
  - Under most scenarios, inflation would remain on a downward trend.

### Projections and outlook
- Inflation in Portugal and other AEs is projected to decline gradually in 2023 and 2024.
- Analysis on inflation processes suggests that inflation in Portugal has likely peaked, though some upside risks should not be ignored.

### Policy-relevant implications (drawn from the analysis)
- Monitor wage developments for risks of a sustained wage-price inflation spiral.
- Use model-based forecasting and sensitivity analysis to assess the impact of international commodity price pass-through and other shocks.
- Maintain attention to synchronization with euro area inflation dynamics given strong correlation with the EA.

*International Monetary Fund. Portugal: Selected Issues, IMF Staff Country Reports 2023, 219 (June 22, 2023).*

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## Content in this bundle

- **Portugal: Selected Issues; IMF Country Report No. 23/219; June 1, 2023**
  - [Portugal: Selected Issues; IMF Country Report No. 23/219; June 1, 2023 (Markdown version)](/-/media/files/publications/cr/2023/english/1prtea2023002.pdf.md){rel="alternate" type="text/markdown"}
  - [Portugal: Selected Issues; IMF Country Report No. 23/219; June 1, 2023 (PDF)](/-/media/files/publications/cr/2023/english/1prtea2023002.pdf){rel="external" type="application/pdf"}

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_Source: https://www.imf.org/en/publications/cr/issues/2023/06/21/portugal-selected-issues-535043_