This assessment is part of the autumn European Semester package, with Portugal among 12 euro-area members deemed compliant.

The autumn Semester package also highlights concerns about adherence to the EU budgetary trajectory and rules.

The European Commission approved Portugal’s 2026 draft budget but warned that spending could exceed the EU’s medium‑term growth rule, with a cumulative deviation seen at about 0.7% of GDP through 2026.

The assessment focuses on policy implications and the EC stance, presenting a concise view of how Portugal’s fiscal trajectory may unfold.

Portugal’s repayment capacity is supported by healthy liquidity reserves and an active debt management strategy, reinforcing confidence in fiscal sustainability.

Post-programme surveillance notes prudent liquidity management and proactive debt policies as contributors to a favorable outlook.

Nine countries, including France, remain under the Excessive Deficit Procedure, with Finland also facing one.

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European Commissioner cautioned against a direct focus on net expenditure, urging continued discipline to lower the debt ratio, with no specific reference to energy relief measures in this budget analysis.

Portugal is in a group of 12 compliant EU budget proposals and is urged to keep policies on track to hold the deficit near balance and reduce debt‑to‑GDP.

Net expenditure is projected to rise around 26% from 2023, already above the Council’s 23.4% GDP target, signaling a potential Excessive Deficit Procedure if the path isn’t corrected.

The Commission stresses this is not a crisis, but a risk to the budget stance that could undermine the planned balance for 2026.