The INE had previously estimated the public sector budget deficit at 2.1% of GDP.

"This only serves to reinforce what the government has said about the enormous rigour and the results that we’ve obtained in budgetary execution,” Centeno said as he left a session of parliament’s budget and finance committee.

The headline 2% figure is the lowest budget deficit in modern Portuguese democracy, since 1974.

Centeno had previously told parliament that the deficit would not be greater than 2.1% of GDP.

The INE explained its revision of the 2016 deficit as being the result of its having discovered an error in the inclusion of information relating to local authorities, “with a significant impact” on the public sector borrowing requirement.

The news came a day after the Council for Public Finances (CFP), a state watchdog, said that the 2016 deficit was 2.5% if extraordinary measures are stripped out, such as the tax amnesty, known as PERES, that brought in hundreds of thousands of euros in extra revenue into state coffers in the last few weeks of the year.

Centeno was in parliament to testify on the subject of Novo Banco, the successor bank to Banco Espírito Santo, which was wound up in 2014. Novo Banco, which was taken over by the banking sector resolution fund with the aid of a huge state loan, is in the course of being sold to US private equity firm Lone Star.