While conditions in the Eurozone are improving, Portuguese stocks and the related exchange traded fund are still showing signs of volatility.
Portugal has come a long way since the Eurozone financial crisis, catching up to other bailed-out peripheral states. There are even speculation that the country could exit its bailout program entirely in the coming weeks.
The International Monetary Fund calculates that Portugal’s structural deficit, the difference between revenue and spending beyond normal growth, is now lower than that of Ireland or Spain, reports Richard Barely for the Wall Street Journal.
Citigroup points out that Portugal’s exports are looking much healthier and the country moved into a current account surplus for the first time since the late 1960s.
However, Portugal’s economy still faces some major headwinds. For instance, the unemployment rate remains at a high 15.3% in February, albeit lower than the 17.5% for the same month last year. With the government still intent on clamping down on the budget deficit, the jobless rate could remain elevated for some years. [Portugal ETF Rallies as Country Nears Bailout Exit]
While the peripheral state has seen a turn to a current account surplus, the turn from a deficit has come at the expense of a collapse in domestic demand, writes Alen Mattich for the Wall Street Journal.