PORTUGAL: AD & PS Neck-And-Neck, Chega Raises Prospect Of Right-Wing Coalition
The opinion polling ahead of the 18 May election shows an effective dead heat between PM Luis Montenegro's centre-right Democratic Alliance (AD) and the centre-left Socialist Party (PS) of Pedro Nuno Santos. The most recent Intercampus and Aximage polls have the PS on 29-30% compared to 27% for the AD. With the margins of error ~4%, both polls indicate a statistical tie.
- Indeed, polling shows very little change from the result of the March 2024 legislative election, where the AD won 80 seats on 28.8% of the vote, compared to 78 seats for the PS on 28.0%.
- The right-wing populist Chega ('Enough') is also polling around the 18.1% it received in the 2024 election, indicating it could end up with a similar number of seats compared to last time (50).
- After the 2024 election, the AD governed as a minority administration propped up by its historic adversary, the PS. However, amid the acrimony that surrounded the Montenegro gov'ts collapse in March, the another minority AD gov't supported by the PS (or vice versa) may prove impossible to agree on.
- This raises the prospect of the AD governing with the support of Chega. Chega leader Andre Ventura said earlier in the month, "Chega is available, but not at all costs", adding Montenegro must "explain how he has the assets he has in the exercise of political activity".
- Ventura has advocated a right-wing gov't even if the PS emerges as the largest party.
Chart 1. Legislative Election Opinion Polling, % and 5-Poll Moving Average
Source: Intercampus, Aximage, Consulmark, Pitagorica, CESOP-UCP, ICS/ISCTE, MNI
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US DATA: Energy Services Pickup Offsets Sequential Food Disinflation
On the headline side of CPI, the pullback to 0.22% M/M from 0.47% in Jan came with lower than expected food price inflation (0.2% M/M vs 0.3% expected, 0.4% prior) offset by slightly less of a pullback in energy prices than expected (0.2% vs 0.0% expected, 1.1% prior).
- Within food, it was "food at home" (ie groceries) that was the main decelerator, rising 0.0% after 0.5% prior, with dairy and fruit/vegetables in sequential deflation (-1.0% and -0.5% respectively), and meats/poultry/fish/eggs decelerating to a still-high 1.6% (1.9% prior). Food away from home ticked up however to 0.4% after 0.2% prior.
- The closely-watched eggs category saw a 10.5% increase, a slight deceleration from 15.2% in January ( though it's now up 58.8% Y/Y).
- Within energy, motor fuel's 0.9% decline matched expectations, but a strong pickup in energy services (1.4% after 0.3%) led by acceleration in both electricity and gas led to the above-expected aggregate figure.
