Bank of Portugal Forecasts Economy Will Shrink a Third Year

Portugal’s economy will contract for a third year in 2013 as the government raises taxes and investment drops, the country’s central bank said.

Gross domestic product will shrink 1.6 percent after declining an estimated 3 percent in 2012, the Lisbon-based Bank of Portugal said today in its autumn economic bulletin. In July, the bank forecast no growth for 2013.