Portugal’s economy rebounds: GDP growth forecast and unemployment drops to 5.5%

The June 2026 CIP‑Confederação Empresarial de Portugal/ISEG barometer projects that Portugal’s economy will resume chain‑linked GDP growth in the second quarter of 2026 after earlier stagnation. The report highlights positive sectoral activity in services, construction, retail and manufacturing, a rise in export growth outpacing imports, and industrial production gains across all groups except energy. Director‑general Rafael Alves Rocha noted firms’ adaptation to challenging conditions such as wars, geopolitical instability and rising energy costs, while warning that the full impact of higher energy prices on value chains remains unclear.

In May 2026, the national statistics institute (INE) recorded an unemployment rate of 5.5%, the lowest level since December 2001, with about 315 000 people unemployed—8 000 fewer than the previous month and 30 000 fewer than a year earlier. The employment rate rose to 66.5%, the highest since February 1998, and the inactive population fell to 29.6%, also a record low. Under‑utilisation of labour stood at 9.4%, the lowest since 2011.