Centeno expects better economy reaction to eventual third wave

Centeno expects better economy reaction to eventual third wave

The governor of Banco de Portugal (BdP), Mário Centeno, said today that he expects the behavior of the Portuguese economy in the face of an eventual third wave of the pandemic, after Christmas, to be better than that seen in the previous ones.

"It is expected that if a third wave succeeds, all this learning, and in a context where there is already vaccination, a much more restrained effect on the economy can be expected," Mário Centeno told reporters today, at the press conference presenting the Bulletin Economic.

The BdP today maintained the forecasts for the Portuguese economy in 2020, anticipating a 8.1% drop in Gross Domestic Product (GDP), according to the Economic Bulletin released today, and for 2021 it expects economic growth of 3.9% .

"We do not disclose quarterly projections, but we have a gradual recovery clearly more from the second quarter, the economy, in 2021, and what is underlying here is precisely some maintenance of containment measures in the first quarter of 2021 and after, then, a resumption of economic activity with more intensity from and including the second quarter "of 2021, added the governor.

During the presentation of the Economic Bulletin, Mário Centeno said that Banco de Portugal expects a drop in GDP of 1.8%, in a chain, in the fourth quarter of this year, something that will have effects on the start of next year.

Mário Centeno warned, therefore, that "the drag effect for 2021 is not entirely favorable, at this moment", when compared to previous forecasts, in particular with those of October.

"We had the same number for the year [de 2020, que é de -8,1%], but with a very different quarterly composition, with less growth in the third quarter and more growth in the fourth quarter, "said the former finance minister.

In this way, and even in view of the growth forecast for 2022 (4.5%), "the growth rate for 2021 is very affected by the bad starting point originated in the fourth quarter of 2020", said Mário Centeno, considering that "it is a little misleading for the dynamic that, quarter after quarter, will be consolidated in Portugal ".


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