Business Barometer – European Central Bank’s Interest Rate
The Business Barometer, a joint effort by The Lisbon MBA Católica|Nova and Dinheiro Vivo, provides valuable insights into current economic and corporate trends. The most recent edition delved into the European Central Bank’s Interest Rate and Portugal’s economic landscape, collecting opinions from the Alumni Community.
With a caretaker government and legislative elections scheduled for 2024, over half of the alumni from The Lisbon MBA Católica|Nova who participated in this barometer believe that political uncertainty may impact the growth of the Portuguese economy in 2024.
109 former students of The Lisbon MBA Católica|Nova participated in this barometer. They answered questions about the evolution of interest rates and inflation, anticipating the economic trends for 2024, as well as unemployment.
The majority, specifically 53.37% of respondents, believe that the rate hikes by the European Central Bank, initiated in July of 2022, have come to an end, and nearly 25% admit this possibility.
They are more certain about the continuation of the slowdown in the inflation rate in the eurozone, with 60.5% saying that prices will continue to decelerate and 27.4% considering it a possibility. In November 2023, inflation in the eurozone dropped to 2.4% (it was 2.9% in October 2023), reaching the lowest value since July 2021.
The alumni of The Lisbon MBA are also pessimistic about the evolution of the unemployment rate in 2024. Over 50% believe that unemployment will increase, and 23.6% admit that this may be the scenario. In November 2023, the number of registered unemployed in employment centers increased for the fifth consecutive month, reaching 312 thousand people. The increase compared to the same month in 2022 was 5.3%.
This year will be a year of legislative elections in Portugal, on March 10, following the resignation of António Costa as prime minister of a majority government on November 7. More than half of those who participated in this survey believe that this political uncertainty may impact the growth of the Portuguese economy next year.
Looking abroad, MBA alumni from The Lisbon MBA Católica|Nova are divided on the short-term outlook for the global economy, with 44% anticipating a stabilization of activity, 35% admitting a slight contraction, and 21% considering a contrary scenario of slight improvement.
Specifically regarding the Portuguese economy, the largest percentage, 44%, foresees a slight contraction in three months, and 38% expect stabilization of economic activity.
As for the prospects for unemployment in Portugal in three months, they are more favorable, with 52% predicting a slight decline and 42% anticipating stabilization.
Regarding investment, 48% of alumni who participated in this barometer believe it will decline in the coming times, a percentage close to 45.4% who believe it will remain at current levels.
In relation to access to credit, which banks admit to having lower demand, 45% of respondents believe that conditions will remain stable, 36% say they will worsen slightly, and 16% even believe they will improve.
Read the full article (original) in Portuguese here.
Source: Dinheiro Vivo