Summary
In May, the economic sentiment and the consumer confidence indicators recovered tenuously in the Euro Area (EA) and in the European Union (EU27).
In Portugal, the economic climate indicator increased in May, interrupting the strong downward movement started a year before. The economic activity indicator diminished again in April, maintaining the negative trend started in January 2008. The private consumption indicator stabilized in April, due to the stabilization of the non-durable consumption component, while the durable consumption component was slightly less negative. The GFCF indicator continued to present a strong negative variation in April, although less accentuated than in March reflecting, mainly, the less negative behaviour of the construction component. Concerning the international trade of goods, imports and exports continued to register strong negative year-on-year nominal growth rates in April, respectively -30.2% and -27.8% (-24.7% and -27.7%, in the same order, in March). The more intense reduction of imports since the beginning of the year might reflect, partly, a gain in the terms of trade.
In May, the year-on-year monthly change rate of the Consumer Price Index was -1.2%, prolonging the downward movement started in July 2008 (when the normal VAT rate was reduced 1.0 p.p.). The core inflation index presented a year-on-year growth rate of 0.5% (0.4 p.p. less than in the previous month). The differential between the EA Harmonized Index of Consumer Prices (HICP) and the Portuguese HICP stabilised in May in 1.2 p.p..