The Organization for Economic Co-operation and Development (OECD) maintains its forecasts for Portugal’s inflation to fall to 3.3% in 2024, now also indicating a decline to 2.4% in 2025.
According to an updated economic outlook report released this Wednesday, the organization said that as energy and food prices and labor demand slow, inflation will fall by 5.5% this year (5.7% in the last update ) to 3.3. % in 2024 and 2.4% in 2025, which is close to the 2% target that the European Central Bank wants to achieve.
International Monetary Fund forecasts, in turn, indicate a decline in inflation to 5.3% in 2023 and to 3.4% in 2024.
The Bank of Portugal (BdP) raised inflation slightly this year to 5.4% and 3.6%, mainly due to energy prices, but expects the rate to continue to fall.
“Gradual removal of energy and inflation support and high nominal GDP growth [Produto Interno Bruto] will help maintain a budget surplus and reduce public debt to approximately 98% of GDP in 2025 (Maastricht definition),” the OECD report emphasized.
“Higher-than-expected employment or wage growth will support consumption but will also contribute to inflation,” he warned, and “in turn, PRR spending will [Plano de Recuperação e Resiliência] may be implemented more slowly than forecast, which will entail lower growth and inflation rates,” the organization believes.
Author: Lusa
Source: CM Jornal
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