Unemployment rate fell to 9.8% in March 2017


Page created: Thursday, 4 May 2017 10:55 GMT | Updated: Friday, 12 May 2017 12:59 GMT

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Inflation fell to 1.4% in March 2017

In March 2017, the unemployment rate continued its downward trajectory, standing at 9.8%, and the employment rate rose to 59.6%. The consumer price index rose 1.4%, a decrease of 0.3 pp compared to the previous month. The consumer confidence indicator has reached its maximum value of the last 20 years.

According to the definitive estimate of INE – Statistics Portugal, the unemployment rate stood at 9.9% in February 2017. In March, the unemployment rate decreased again to 9.8%, which corresponds to a reduction of 2.2 pp in year-on-year terms. The unemployed population was 504 000 people, corresponding to a decrease of 4 300 people from the previous month. The employment rate rose to 59.6%, reflecting a monthly increase in the employed population of 15 900 people.

The Consumer Price Index (CPI) registered a year-on-year change of 1.4% in March 2017, which corresponds to a reduction of 0.2 pp compared to the previous month due to a deceleration of fuel prices. The underlying inflation indicator, CPI excluding energy and unprocessed food products, registered a year-on-year change of 0.6%. The Harmonized Index of Consumer Prices, which serves to compare prices between the different countries of the European Union, also registered a year-on-year change of 1.4%, lower than in the Euro Zone and in the European Union, 1.5% and 1.6%, respectively.

The economic climate indicator and the consumer confidence indicator of INE – Statistics Portugal increased again in April, with the latter reaching its maximum level since October 1997. The European Commission’s economic sentiment indicator increased as well, extending its growing trend started in September. The coincident indicators of Banco de Portugal (Portuguese Central Bank) for economic activity increased again and the indicator for private consumption stabilised in March. The OECD composite indicators index fell again to 2013 lows, presenting the value of 99.74, setting itself for the second consecutive month to a figure below 100, which may indicate a slowdown in economic activity in the next six to nine months.

The International Monetary Fund (IMF) improved the economic outlook for Portugal, now forecasting GDP growth of 1.7% this year and 1.5% in 2018. As for unemployment, the IMF continues to forecast an average rate of 10.6% this year and 10.1% in 2018. The current account has also been revised by the Fund, which forecasts a surplus of 0.8% of GDP this year and a deficit of 0.3% in 2018.

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