LISBON, March 24 (Reuters) - Portugal's central bank on
Friday slightly raised its 2023 economic growth forecast to 1.8%
from 1.5% predicted in December, which would still be a sharp
slowdown from last year's expansion of 6.7% due to rampant
inflation and interest rates.
In its quarterly economic bulletin, the Bank of Portugal
attributed the outlook change mainly to expected "favourable
developments" in the tourism sector, while private consumption -
which represents two-thirds of gross domestic product - should
nearly stagnate this year after growing 5.7% in 2022.
It expects the southern European country's EU-harmonised
inflation to decelerate this year to 5.5% from 8.1% in 2022,
even though last month consumer prices still jumped 8.6% from a
year ago.
The central bank sees key risks to growth coming from the
impact of interest rate hikes, increased tensions in the
financial markets amid concerns about the strength of the global
banking system, and an escalation of the conflict in Ukraine.
"Recent tensions in financial markets imply additional risks
of uncertain magnitude," the financial authority said.
(Reporting by Sergio Goncalves; Editing by Catarina Demony and
Andrei Khalip)
Messaging: sergio.goncalves.reuters.com@reuters.net))
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