Portugal

Companies further away from the consumer weigh almost half of the transmission of interest in Portugal

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Based on a feed excerpt; full article content has not been acquired. Source evidence retrieved 29/09/2026, 15:56:24 UTC.

Briefings

A study published by the Banco de Portugal analyzes how the European Central Bank's monetary policy transmission varies across countries based on corporate exposure to consumers. Nine researchers from central banks found that upstream companies (further from consumers) account for nearly half of price transmission in Portugal, whereas downstream companies dominate in Estonia. The research uses 2019 tax and VAT data to compare Portugal's 38.7 million transactions against Italy's 59.4 million, revealing that smaller, more open economies like Portugal have shorter supply chains and more uniform price transmission compared to complex, large economies like Italy. The analysis was conducted after the BCE raised interest rates in response to inflation above the 2% target, with effects observed 12-18 months post-decision.

Key points

• Upstream companies (further from consumers) account for nearly half of price transmission in Portugal, while downstream companies dominate in Estonia.
• Portugal's 2019 tax and VAT data shows 38.7 million transactions, significantly lower than Italy's 59.4 million, resulting in more uniform price transmission across the corporate sector.

Context and limitations

The study relies on 2019 tax and VAT data and applies Belgian data to other countries; effects are observed 12-18 months after policy decisions, limiting immediate impact assessment.

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