The benchmark interest rate in Portugal is set by the European Central Bank. Interest Rate in Portugal averaged 1.78 percent from 1998 until 2023, reaching an all time high of 4.75 percent in October of 2000 and a record low of 0.00 percent in March of 2016. source: European Central Bank
Interest Rate in Portugal is expected to be 4.50 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. In the long-term, the Portugal Interest Rate is projected to trend around 3.50 percent in 2024 and 2.75 percent in 2025, according to our econometric models.
Portugal Interest Rate
Portugal is a member of the European Union which has adopted the euro. Portugal's benchmark interest rate is set by the European Central Bank. The official designation for the rate is main refinancing operation.
| Actual | Previous | Highest | Lowest | Dates | Unit | Frequency | |
| 4.50 | 4.50 | 4.75 | 0.00 | 1998 - 2023 | percent | Daily | |
As an expert in financial markets and monetary policy, my extensive knowledge allows me to delve into the intricacies of Portugal's benchmark interest rate. The benchmark interest rate in Portugal is not autonomously determined by the country itself; rather, it is set by the European Central Bank (ECB). This is a crucial aspect of Portugal's monetary policy, as the country is a member of the European Union and has adopted the euro as its official currency.
The benchmark interest rate, also known as the main refinancing operation rate, plays a pivotal role in shaping the overall interest rate environment within Portugal. It directly influences the cost of borrowing for banks and, consequently, has a cascading effect on interest rates for businesses and consumers throughout the country. This mechanism is part of the broader monetary policy framework employed by the ECB to achieve its objectives, such as price stability and economic growth.
Analyzing historical data, we observe that the interest rate in Portugal has exhibited a dynamic pattern. Over the period from 1998 to 2023, the average interest rate stood at 1.78 percent. Notably, there was a peak of 4.75 percent in October 2000, reflecting a period of relatively higher interest rates. Conversely, in March 2016, the interest rate reached a historic low of 0.00 percent, signaling a phase of exceptionally accommodative monetary policy.
Looking ahead, projections from Trading Economics global macro models and analysts suggest that the interest rate in Portugal is expected to be 4.50 percent by the end of the current quarter. The long-term outlook, based on econometric models, anticipates a gradual decline, with the interest rate projected to trend around 3.50 percent in 2024 and further decreasing to 2.75 percent in 2025. These forecasts indicate the potential shifts in the monetary policy stance and economic conditions that may influence interest rates in Portugal in the coming years.
In summary, my in-depth understanding of monetary policy frameworks, coupled with a keen analysis of historical trends and future projections, allows me to elucidate the intricacies of Portugal's benchmark interest rate. The collaborative efforts of global macro models and expert analyses provide valuable insights into the expected trajectory of interest rates, enabling a comprehensive understanding of the financial landscape in Portugal.
FAQs
Portugal Long Term Interest Rate is at 3.02%, compared to 3.06% last month and 3.27% last year. This is lower than the long term average of 4.89%.
What are mortgage rates in Portugal? ›
In Portugal, average interest rates on new home loans have been stabilising at 4.2% since June. And in the euro area, average interest rates continue to rise, having reached 4% in November for the first time since 2009.
What is the cash rate in Portugal? ›
In the latest reports, Portugal Short Term Interest Rate: Month End: EURIBOR: 3 Months was reported at -0.57 % pa in Nov 2021. The cash rate (Policy Rate: Month End: Main Refinancing Operations) was set at 4.50 % pa in Feb 2024. Portugal Exchange Rate against USD averaged 0.92 (USD/EUR) in Jun 2023.
What are bank fixed deposit rates in Portugal? ›
All Term Deposit offers from Banco Português de Gestão
| Interest rate | Term | Currency |
|---|
| 2.50 % AER | 6 months | EUR |
| 3.25 % AER | 1 year | EUR |
| 3.40 % AER | 2 years | EUR |
| 3.06 % AER | 3 years | EUR |
Which country has the highest interest rate on a savings account? The Central Bank of Hungary had a base rate of 13% in 2023. This makes Hungary the country in Europe with the highest interest rate on a savings account.
Is it a good idea to buy property in Portugal? ›
Buying Portugal real estate to rent is an excellent financial investment. It is worth it as there is more demand for accommodation than what is currently available — especially in Lisbon and Porto. Also, rental yields during peak tourism season make property rental in Portugal a viable investment.
Can a US citizen get a mortgage in Portugal? ›
There are also no restrictions on foreigners taking out a mortgage in Portugal. However, it is likely to be easier to get a home loan if you have Portuguese residency.
Is it expensive to live in Portugal? ›
How much money do you need to live comfortably in Portugal? Compared to some other countries in Europe, Portugal is exceptionally affordable. A couple with a mid-range income can live comfortably in Portugal's cities for around €1,700 per month. A couple in Lisbon can live on around €2,000 per month.
Is Spain or Portugal cheaper? ›
Generally speaking, Portugal is cheaper than Spain, although the flight there will likely be the most expensive part of your Portugal vacation. A standard flight from North America to Lisbon in May will cost around $1,200 to $1,300CAD for a round trip.
Is Portugal cheap or expensive? ›
How expensive is Portugal for Americans? Portugal is one of the most affordable countries in Western Europe, with food available at affordable prices, cheap options for accommodation, and reasonable costs for transport.
Santander Totta was also named the safest bank in Portugal by Global Finance in 2016. Santander allows clients to open personal and business accounts and provides solutions such as insurance (health, life, car, and workers' compensation insurance), savings accounts, loans, and investment funds.
Are interest rates going up in Portugal? ›
Interest Rate in Portugal is expected to be 4.50 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. In the long-term, the Portugal Interest Rate is projected to trend around 3.50 percent in 2024 and 2.75 percent in 2025, according to our econometric models.
What is the minimum deposit in Portugal? ›
How much do I need to deposit? For a Portuguese mortgage, the minimum deposit is usually at least 30 percent of the purchase price for non-residents, which is because financing institutions only provide between 60 percent to 70 percent credit of the valuation price.
Which foreign bank gives highest interest rate? ›
Foreign Banks Fixed Deposit Rates
| Bank Name | Interest Rates for Tenure 1-2 years | Interest Rates for Tenure 3-5 years |
|---|
| Deutsche Bank | 7.00% - 7.50% | 7.75% - 7.00% |
| DBS Bank | 6.25% - 7.25% | 6.50% |
| Barclays Bank | 5.89% - 5.86% | 5.69% - 5.67% |
| Doha Bank | 6.50% - 7.30% | 6.25% |
7 more rowsCountries with the highest savings rates
- Switzerland: 19.3% savings rate.
- Sweden: 13.3% savings rate.
- Netherlands: 12.3% savings rate.
- Luxembourg: 11.6% savings rate.
- France: 11.2% savings rate.
Countries with the highest deposit interest rates worldwide 2023. As of August 2023, the country with the highest deposit interest rate worldwide was Argentina, where the interest rate was as high as 113 percent. Second in the list came an African country, Zimbabwe, where the interest rate reached 110 percent.
Is it expensive to buy a house in Portugal? ›
The real estate market in Portugal keeps growing steadily. In 2023, the average house costs 2,510 €/m2, almost 7% more than the year before. In April 2019, the average price of property was at 1,877 €/m2. However, prices still vary considerably depending on the area.
Can you get a 40 year mortgage in Portugal? ›
Ages 30 and under: You can pay a mortgage for 40 years. * Ages 35 and up: The maximum mortgage amount is given for a period of 35 years. * This condition will not apply to ages 40 and up because most Portuguese banks only allow you to take out a mortgage until the age of 75.
Is it easy to get a mortgage in Portugal? ›
Rules, lending criteria and deposit requirements
Portugal has a great reputation for welcoming non-residents and the mortgage application process is relatively straightforward, even for people living outside the country.
How many years is a mortgage in Portugal? ›
Most banks offer a maximum mortgage term of 50 years for Portuguese residents and 30 years for non-residents. The maximum age upon maturity of the mortgage is generally 80 for residents and 75 for non-residents. Can I repay my Portuguese mortgage early? Mortgages can be repaid early at any time during the loan term.
