António Pedro Santos / Lusa
The Minister of State and Finance, Joaquim Miranda Sarmento
Growth of 1.9% last year, according to INE estimates. Government had predicted 2%. Drop compared to 2024.
The Portuguese economy grew 1.9% in 2025, according to the quick estimate released today by the National Statistics Institute (INE).
This value compares with the 2% growth forecast included by the Government in the State Budget for 2026 and is a slowdown compared to the 2.1% increase in 2024.
This growth was driven by domestic demand, “reflecting the acceleration of private consumption and investment”, while gross fixed capital formation slowed down.
“The contribution of net external demand was more negative in 2025, with exports of goods and services in volume decelerating more pronouncedly than imports of goods and services”, explains INE.
In the fourth quarter, the Gross Domestic Product (GDP) in volume grew 1.9% year-on-year and 0.8% quarter-on-quarter.
According to INE, the negative contribution of net external demand to the year-on-year variation in GDP was reduced, following a pronounced slowdown in imports of goods and services and a reduction in exports of goods and services, particularly reflecting the “decrease in transactions in petroleum products”.
Domestic demand also contributed less to growth, with a slowdown in private consumption and investment.
Inflation
Inflation slowed to 1.9% in January, also according to a flash estimate from .
The annual rate of change in the Consumer Price Index (IPC) estimated for January is 0.3 percentage points (pp) lower than that observed in the previous month, indicates INE.
Underlying inflation, which excludes more volatile products such as unprocessed food and energy, was 1.8%, also 0.3 pp lower than in the previous month.
According to the statistics office, the variation in the index for energy products was -2.2% (-2.4% in December 2025) and the index for unprocessed food products slowed from 6.1% to 5.8%.
As for the Portuguese Harmonized Index of Consumer Prices (HICP), which allows comparisons with other European countries, it recorded a year-on-year variation of 1.9% (2.4% in December).
