Portugal's Industrial Output Drops 3.8 Percent in August, a Fourth Annual Fall in a Row, as Capital Goods Production Slumps 12 Percent
Manufacturing was 5 percent below its level of a year earlier and output fell 2 percent in a single month, INE's figures show. Intermediate goods were the only group still growing.
Portugal's factories, mines and power plants produced 3.8 percent less in August than a year earlier, the national statistics institute, INE, reported on Thursday. It is the fourth month in a row in which industrial output has been below its level of a year before, and the steepest annual fall since February.
The decline also gathered pace. In July output had been only 0.8 percent lower than a year earlier. Between July and August alone, the seasonally adjusted index dropped 2.0 percent, after a 0.4 percent rise the month before. Manufacturing, the largest part of the index, did worse than the total: output in the manufacturing industries was 5.0 percent lower than in August 2025, against 1.9 percent lower in July. Excluding energy, the index fell 3.6 percent.
Machinery and equipment led the fall
Every one of INE's main industrial groupings did worse than in July. Capital goods, the machinery and equipment that businesses buy to invest, made by far the largest contribution to the fall: their output was 12.1 percent lower than a year earlier, after a 2.9 percent drop in July, and they alone took 2.5 percentage points off the total.
Consumer goods fell 2.6 percent and energy 4.7 percent, subtracting 0.8 and 0.7 points respectively. The only group still growing was intermediate goods, the materials and components that other industries use, which rose 0.6 percent, slightly less than the 0.8 percent of July.
Month on month, the picture was different. Consumer goods made the largest negative contribution, with output down 3.8 percent from July, and intermediate goods fell 2.2 percent. Energy was the only group to grow between July and August, by 0.3 percent.
A weak run after a strong 2025
INE's adjusted series shows how the year has turned. Industrial output grew by 3.4 percent in July 2025 and 3.6 percent in August 2025, which makes this year's comparison harder. The index fell 4.0 percent in February, rebounded by 4.2 percent in March, and has been negative every month since May, at minus 1.6, minus 1.2 and minus 0.8 percent before August's drop.
The fall in output comes as factory costs are rising. INE reported in September that industrial producer prices were 7.2 percent higher in August than a year earlier, pushed up by energy, and consumer price inflation reached 3.6 percent in September, as we reported on Thursday.
A provisional figure
INE cautions that the August data are based on responses received by 28 September, a response rate of 87.7 percent at first release, lower than the 90.8 percent of a year earlier, and that the two previous months are routinely revised as more replies come in. The June and July figures were revised in this release. The next industrial production figures, for September, are due on 2 November.
