In its December Economic Bulletin, the Bank of Portugal trims 0.1 of a point from its forecast for growth in gross domestic product, from the previous 1.7%.


For next year it projects 1.7% and for 2017 it sees 1.8%, in both cases a reduction of 0.2 of a point from its previous projections.
The projections were calculated as of 19 November, when "no information was known relative to the measures of a budgetary nature that will be implemented in the coming years", that is, the 2016 state budget.


The current Socialist government that took office last month has said that it intends to table the draft budget in January.


In the bulletin, the Bank of Portugal cites as the main risk factors of further downward revisions in its growth forecasts as the possibility that world economic activity recovers more slowly than currently expected, and that world trade flows slow, in particular where developing economies are concerned. The latest revision for Portugal's GDP results from a "less favourable" situation than expected where the country's exports are concerned.


The bulletin estimates average inflation of 0.6% this year, slightly up on its previous projection. For next year it sees a rate of 1.1%, slightly lower, and for 2017 of 1.6%, up again.