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Production prices in Portugal decrease and consumer prices continue to decelerate in April 2023


In the Euro Area (EA), Gross Domestic Product (GDP) in volume increased 1.3% in year-on-year terms in the first quarter of 2023 (1.8% in the previous quarter) and 0.1% in quarter-on-quarter terms (0.3% in the fourth quarter).

In Portugal, GDP in real terms registered a year-on-year rate of change of 2.5% in the first quarter (3.2% in the previous quarter) and a quarter-on-quarter increase of 1.6% (0.3% in the previous quarter).

The industrial production price index registered a negative year-on-year rate of change in April (-0.9%), which had not happened since February 2021, after increases of 8.9% and 0.1% in February and March, in sequence of the uninterrupted deceleration profile observed since July 2022. The grouping of Energy was decisive for the reduction of the total index, with rates of -21.5% and -17.9% in March and April, respectively. Excluding the energy component, this index decelerated to 4.7% (8.1% in March). The index for consumer goods recorded a year-on-year change of 9.9% (11.6% in the previous month), decelerating for the fifth consecutive month, after reaching in November the highest growth of the current series (16.2%).

The year-on-year rate of change in the Consumer Price Index (CPI) decelerated to 5.7% in April, 1.7 percentage points (p.p.) less than in the previous month. The index for unprocessed decelerated, from 19.3% in March to 14.2% in April. On the external side, the implicit prices of exports and imports of goods, in March, registered year-on-year rates of change 4.8% and -2.2%, respectively (7.1% and 4.4% in February).

The short-term indicators for economic activity from the perspective of production, available for March, point out to a nominal slowdown in Industry and Services, a real decrease in Industry and an acceleration in Construction. From the expenditure side, the economic activity indicator increased less intensely in March, while the Gross Fixed Capital Formation indicator decreased in year-on-year terms and the private consumption indicator accelerated. The economic climate indicator, which summarizes the balances of responses to questions relating to business surveys, increased between January and April.

According to the Labour Force Survey, in the first quarter of 2023, the unemployment rate stood at 7.2%, 0.7 percentage points more than the rate observed in the previous quarter (5.9% in the first quarter of 2022). The number of unemployed increased by 23.3% in year-on-year terms (year-on-year rate of change of 3.7% in the previous quarter). The labour underutilization rate was 0.8 percentage points higher than in the fourth quarter, standing at 12.5% and 680.7 thousand people (633.1 thousand people in the previous quarter). Total employment increased by 0.4% compared to the previous quarter and 0.5% in year-on-year terms (year-on-year rate of change of 0.5% in the fourth quarter). The volume of hours actually worked has increased by 3.4% in year-on-year terms (4.6% in the previous quarter). The active population had a year-on-year increase of 1.8%.

Source: Statistics Portugal
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