Portugal's economy expanded by 0.8% in the second quarter of 2026, accelerating from an upwardly revised 0.1% growth in the previous quarter, according to preliminary estimates. The rebound was driven by a positive contribution from net exports and stronger private consumption, although investment declined. The recovery followed a weak first quarter, when severe storms disrupted activity in central Portugal, while a surge in energy prices linked to the conflict in Iran weighed on growth. On an annual basis, GDP growth edged up to 2.5% from a revised 2.4% in the previous quarter. The government expects the economy to expand by 2.0% this year, while the Bank of Portugal projects slightly slower growth of 1.8%, following 1.9% growth in 2025.