Economy stagnates in Q1 2026

GDP reading: Portugal's GDP stagnated in seasonally adjusted quarter-on-quarter terms in Q1, following 0.9% growth in the previous quarter. Q1's reading was the weakest since Q1 2025. In annual terms, GDP expanded 2.3% in Q1, following a 1.9% expansion in the prior quarter.

Drivers: Relative to the prior period's data, figures in Q1 softened for private consumption (+0.1% on a seasonally adjusted quarter-on-quarter basis vs +0.9% in Q4) and government consumption (+0.3% vs +0.4% in Q4). In contrast, readings strengthened for fixed investment (+1.9% vs +1.2% in Q4), exports of goods and services (+2.1% vs -0.5% in Q4) and imports of goods and services (+5.4% vs -2.5% in Q4).

Panelist insight: EIU analysts said: “We have revised down our real GDP growth forecast for 2026 from 2% to 1.8% to reflect weaker private consumption stemming from higher inflation. Conversely, investment is set to remain robust in 2026 and to sustain growth above the EU average.”

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