Brussels is more optimistic about inflation in Portugal, revising down its forecast to 2.3% in 2024 and 1.9% in 2025 due to falling energy prices and lower food price increases.
In its winter economic forecasts, the European Commission predicts that inflation, as measured by the Harmonized Index of Consumer Prices (HICP), will record a further decline by 2025 after slowing last year.
The community executive indicates a decline from 5.3% in 2023 to 2.3% in 2024 and 1.9% in 2025, which is lower than forecasts of 3.2% in 2024 and 2.4% in 2024. 2025
The Ministry of Finance is calling for a rate of 3.3% this year in the national budget 2024 (OE2024), as is the Organization for Economic Co-operation and Development (OECD).
The International Monetary Fund (IMF) expects the rate to be 3.4%, the Council of Public Finance (CFP) 2.8% and the Bank of Portugal 2.9%.
This trend is expected to occur as a result of lower energy prices and lower food price increases.
Service prices should also contribute to the expected decline, but at a “much slower” pace as expected wage and employment growth should support consumer demand.
However, in the first half of this year, the disinflation process should be temporarily eased by base effects in the energy sector and the abolition of zero VAT on the basic food basket.
The European Commission forecasts that the eurozone inflation rate will fall from 5.4% in 2023 to 2.7% in 2024, before falling to 2.2% in 2025.
Author: Lusa
Source: CM Jornal
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