The IMF Country Reports Series covers economic and financial developments and trends in member countries. Each report, prepared by a staff team after discussions with officials of the country, is published at the option of the member.
This Selected Issues paper on Portugal reviews a set of issues of relevance to the regime change implied by European Monetary Union participation. It presents an empirical investigation of the business cycle in Portugal. The paper attempts to obtain a quantitative sense of the impact of monetary policy on the Portuguese economy, utilizing an unrestricted vector autoregression methodology to characterize the monetary transmission mechanism. It also examines some key forces at work in Portugal's external sector from different vantage points.