Portugal’s President Touts Economic Turnaround, Global Ratings Boost Expat Confidence

Portugal’s head of state insists the country’s recovery is gathering pace, international analysts are nodding in agreement, and domestic indicators increasingly back that upbeat narrative. For foreigners weighing a move—or already unpacking boxes in Lisbon—those encouraging signals translate into a friendlier job market, slightly calmer real-estate prices, and a firmer policy environment that could affect everything from visa rules to mortgage rates.

A cautiously optimistic snapshot

The president’s declaration that the Portuguese economy is “on the right track” comes after a summer of mixed but mostly positive data: quarterly GDP expanded by 2.1% year-on-year, unemployment retreated to 5.7%, and headline inflation dipped below 3% for the first time since 2021. In a rare televised appearance, he argued that the numbers reveal a country “finally harvesting the fruits of painful reforms” pushed through during the pandemic and energy-price spike. Economists at CaixaBank Research, BNP Paribas and Moody’s—three of the agencies the president cited—have each upgraded Portugal’s 2025 growth outlook in recent weeks.

Why overseas ratings matter this time

When Moody’s raised the sovereign rating to Baa1 last spring, the symbolic bump instantly lowered government borrowing costs. That cheaper funding has now freed up roughly €1.4 B for public-investment projects in transport, renewable energy and digital infrastructure. For expats, those investments can speed up metro extensions in Lisbon, broadband rollouts in the Algarve and new green-hydrogen clusters near Sines—projects that will expand employment opportunities beyond the traditional tourism sector. The president underscored that “external validation reassures foreign investors who often set the tone for local banks’ lending appetite.”

What newcomers feel on the ground

International confidence is gradually trickling into day-to-day life. Multinational tech companies continue to fill coworking hubs in Porto’s downtown, hiring English-speaking developers at wages unthinkable here five years ago. Meanwhile, slower price growth has tempered the break-neck rise in rents: Idealista data show median monthly rents in Lisbon stabilising around €18 per sqm, roughly flat compared with early 2024. Canadian entrepreneur Evan McCall, who relocated under the D7 visa, describes the mood as “cautious but hopeful”, noting that local landlords are finally willing to sign longer leases again.

Threats still on the radar

None of this means sunny skies forever. The president himself warned about the “triple risk” of higher-for-longer ECB rates, lingering wage pressure in tourism, and a Chinese slowdown that could dent Porto’s flourishing export sector. Brussels has already prodded Lisbon to trim its draft 2026 budget deficit by another 0.5 percentage points, and any sudden fiscal tightening might pare back the infrastructure splurge currently buoying construction jobs. Analysts at the University of Minho remind expats that structural pain points—an aging population and low productivity—remain unresolved despite today’s upbeat tone.

Practical takeaways for foreigners in Portugal

For incoming professionals, expect a healthier labour market in information technology, renewable energy and advanced manufacturing, although retail and hospitality pay remains modest. Tenants may finally find more negotiating power as supply ticks up: average time-on-market for Lisbon flats rose to 80 days in August. Prospective homeowners should watch bond yields; a full percentage-point drop in Portuguese 10-year debt since April has already nudged variable mortgage rates below 3.5%. Finally, the president hinted that the government will keep “competitive visa channels”—notably the revamped Digital Nomad Permit—because attracting foreign talent has become a pillar of the growth strategy he is so eager to defend.

Whether the optimism holds will depend on factors far beyond Belém Palace, but for now the data, the ratings agencies and everyday reality are aligned: Portugal is offering expats a more stable economic landing zone than at any point in the past decade.