Four in Ten Portuguese Say They Are Worse Off Than a Year Ago, and Most Expect Worse to Come

Nearly four in ten Portuguese say their personal finances have deteriorated over the past year, and a clear majority expect the squeeze to worsen before 2026 is out. A new opinion poll by Aximage, reported by ECO, found that 39% of respondents judged their household economic situation to be worse than it was twelve months ago, against just 14% who felt better off and 47% who saw no change. More striking is the outlook: 63% believe their situation will keep deteriorating through the end of the year.

The survey measures perception rather than statistics — how people feel about their own wallets, not what the national accounts record — but sentiment of this kind tends to shape real behaviour, from spending and borrowing to whether households feel secure enough to move, hire help or take on a mortgage. A population that expects to be poorer in six months spends cautiously, and that caution feeds back into the wider economy.

Pessimism with a political tint

The gloom is not evenly distributed, and the poll's sharpest divide is political. Among voters of the governing AD (Aliança Democrática, or Democratic Alliance) coalition, only 21% reported a worsening situation and 22% actually felt better off. Among opposition voters the mood darkens steeply — 47% of Socialist (PS) and Chega voters reported decline, rising to 58% for Livre and 72% for the communist-led CDU (Coligação Democrática Unitária, or Unitary Democratic Coalition). That spread is a reminder that economic "feeling" is partly a proxy for how people view the government of the day.

Even allowing for that filter, the underlying signal is consistent with the harder data. Portuguese wages remain among the lowest in Western Europe, housing costs have climbed faster than incomes in Lisbon and Porto, and while headline inflation has cooled from its 2022–2023 peaks, the price level itself has not fallen — groceries, rent and services simply stopped rising as fast, from a base that already hurt. For many households, "inflation is down" and "I feel poorer" are both true at once.

The forward-looking pessimism — 63% expecting further decline — is the number policymakers should watch most closely. Consumer confidence is a leading indicator, and sustained negativity can dampen the domestic demand that has propped up Portuguese growth. It also sets a difficult backdrop for the government as it prepares the 2027 State Budget and continues to negotiate wage and tax measures with the social partners.

What This Means for Expats

• The mood is local, your exposure may differ. If your income is in euros from a Portuguese employer, this pessimism is your context too. If you earn abroad or in a stronger currency, you are partly insulated — but you still buy groceries and pay rent in the same market.
• Weak confidence can mean opportunities. Cautious consumers and softer demand can ease pressure in some segments — negotiating power on services, second-hand goods and certain rentals may improve where locals are tightening belts.
• Budget from prices, not headlines. "Inflation is falling" does not mean things are getting cheaper. Plan around today's price level, which is materially higher than it was three years ago.
• Watch policy signals. With most people expecting a worse year, expect the cost of living to dominate the autumn budget debate — the source of any relief on wages, IRS or benefits that would reach your household.

Whether the second half of 2026 validates the pessimism will depend on wages, energy prices and the global backdrop as much as on anything decided in Lisbon. For the numbers behind the mood, see our detailed cost-of-living guide for 2026, our report on how the opposition is centring the cost of living in Parliament, and the Bank of Portugal's read on wage growth and compression.