The Portuguese economy grew by 1.9% in 2025, according to the preliminary estimate released this Friday by the National Statistics Institute (INE).
This figure is consistent with the government’s 2% growth forecast in the 2026 State Budget and represents a slowdown relative 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.
“The contribution of net external demand was more negative in 2025, with exports of goods and services in volume slowing more sharply than imports of goods and services,” explains INE.
In the fourth quarter, Gross Domestic Product (GDP) in volume grew 1.9% year-on-year and 0.8% quarter-on-quarter.
According to the INE (National Institute of Statistics), the negative contribution of net external demand to the annual variation in GDP was reduced, following a pronounced slowdown in imports of goods and services and a reduction in exports of goods and services, reflecting the “decrease in transactions of petroleum products”.
Domestic demand also contributed less to growth, with a slowdown in private consumption and investment.
In quarterly terms, net external demand contributed positively to quarter-on-quarter growth, whereas domestic demand had a negative effect.
The statistics office also reports that growth in the third quarter of 2025 has been revised downward by 0.1 percentage point at both the annual and quarterly rates of change, following the incorporation of new primary data into the flash estimate of GDP, including international trade in goods statistics.
