Portugal Business Climate Hits 2019-Highs

Business confidence in Portugal fell to 3 in January 2026 from 3.1 in December, ending two months of improvement as sentiment weakened across most sectors. The economic climate indicator declined after rising in the prior two months, reflecting lower confidence in trade, manufacturing and services. Trade confidence fell for a second month, driven by weaker views on sales volumes and activity expectations for the next three months. Manufacturing confidence also declined, reflecting negative assessments of global demand and near term production prospects. Services sentiment weakened in January due to poorer demand expectations, softer assessments of current activity and weaker order books. By contrast, confidence in construction and public works improved after a prior decline, supported by a strong positive contribution from employment expectations. Entrepreneurs’ price expectations eased in trade and services, while rising in manufacturing and construction.

Business confidence in Portugal edged up to 3.1 in December 2025, the highest reading since April 2019, from 3 in November. Sentiment increased mostly among traders (6 vs 4.9 in November), namely wholesalers (5.7 vs 4.3) and retailers (6.5 vs 5.8) ahead of the Christmas holidays, which are typically associated with higher consumer spending. Confidence among manufacturers also improved (-2 vs -2.6). On the other hand, service providers (6.6 vs 7.8) and constructors (2.2 vs 2.5) showed less optimism.

Business confidence in Portugal inched up to 3 in November 2025, the highest reading since May 2019, from 2.9 previously. Sentiment improved mostly for traders (4.9 vs 3.1), of which retailers (5.8 vs 4.3) and wholesalers (4.3 vs 2), likely reflecting expectations of strong Black Friday and holiday discount sales. Improvements were also seen for constructors (2.5 vs 2.4) and manufacturers (-2.6 vs -3.7), while service providers turned less optimistic (7.8 vs 10.7).