Our relative unit labour costs against our main trading partners (21 countries) increased from 2003 to 2009 by just 4.4% which is well below the increase of 10.9% for the euro area average, using the same concept of the real effective exchange rate. Since 1999 the figures are 9.1% for Portugal and 15.9% for the average of the euro area.
Indeed, a rapid downward spiral of tighter credit, declines in asset prices, rising unemployment, and falling demand caused severe distress and a pullback in spending that was ultimately widespread across households.