Fiscal discipline has restored a level of confidence absent since the sovereign-debt crisis.
LISBON, PORTUGAL
Fitch Ratings has raised Portugal’s long-term sovereign credit rating from A to A+ and assigned a stable outlook. The country has recovered an A+ rating from the agency for the first time since March 2011, when Portugal was approaching the financial crisis that ultimately required an international bailout.
The upgrade reflects Portugal’s stronger public finances, repeated fiscal outperformance and continued reduction of government debt. Fitch expects the debt ratio to fall from 89.7% of gross domestic product in 2025 to 87% in 2026 and 82.9% by 2028. Despite that progress, debt remains considerably above the projected 59.5% median among countries with comparable A-category ratings.
Portugal recorded a budget surplus equivalent to 0.7% of GDP in 2025. Fitch expects it to narrow to 0.1% in 2026 because of storm reconstruction, tax relief, housing measures, higher wages and pensions, and increased investment under the European recovery program. Small deficits averaging approximately 0.4% of GDP are projected for 2027 and 2028, but these would remain stronger than the agency’s peer-group average.
Economic growth is forecast to accelerate from 1.9% in 2025 to 2.1% in 2026, supported by private consumption, employment, real-wage gains and investment financed partly through EU funds. Portugal also benefits from eurozone membership, stable institutions and persistent current-account surpluses. An improved rating can contribute to more favorable financing conditions for the government and potentially for Portuguese companies and households, although market interest rates depend on broader European and global conditions.
Significant vulnerabilities remain. Population ageing, lower net migration, rising defense commitments and elevated external debt could pressure future budgets. Housing prices in early 2026 were approximately 99% above their late-2019 level, intensifying affordability problems even though Fitch does not yet see an immediate macrofinancial crisis. The stable outlook therefore recognizes substantial progress while signalling that Portugal must preserve fiscal discipline to protect its regained credibility.
Lo visible y lo oculto, en contexto. / The visible and the hidden, in context.