Financial markets today have been whipsawed yet again by data showing the one bright spot on the eurozone’s economic horizon – the German growth engine – may be faltering. But Eurostat’s quarterly report on the currency region’s economic health did have at least one unexpected positive surprise, too: Portugal.
Yes, Lisbon may be beginning a wrenching austerity programme, agreed as part of its €78bn bail-out. And yes, the country’s bonds suffered recent downgrades because debt analysts do not think Lisbon will be able hit the bail-out’s debt and deficit targets.
But during the second quarter of the year, the Portuguese economy was flat – a significant improvement after two quarters of 0.6 per cent shrinkage, and much better than the 1.1 per cent decrease that analysts predicted.