Portugal's president Marcelo Rebelo de Sousa warned the country's prime minister that their dispute puts Portugal on the brink of a political crisis.

"All things considered, I will continue to prefer the guarantee of institutional stability," amid the ongoing struggle of high inflation and interest rates, the president commented.

According to analysts, the likelihood of a snap election leading to a hung parliament and unstable government has likely stopped the president from implementing more radical measures, Reuters reports.

However, he added that the government had a lot of work ahead to retain its credibility. 

Earlier this week, opposition parties urged the president to dissolve parliament after PM Antonio Costa rebuffed an offer by Infrastructure Minister Joao Galamba to resign amid a scandal involving the government-owned TAP airline.

"The government did not assume the responsibility as it should have by replacing the infrastructure minister," Rebelo de Sousa stated.

"Political and administrative responsibility is essential for the Portuguese to believe in those who govern them ... What happened will have other effects in the future, I'll have to be more attentive to the question of political and administrative responsibility" of the government, he added.

Although he has cooperated with the PM since he was initially elected president in 2016, Rebelo de Sousa has shown mounting unrest, slamming insufficient new people in the government, which he described as "worn out and tired."

In addition, due to a growth slowdown throughout Europe, a government crisis would complicate the supply of crucial EU pandemic recovery funds in the country.

Over the last year, over ten ministers and secretaries of state have left their roles, with at least two associated with the TAP scandal, fuelled by an irregular severance payment to a board member, the Reuters report adds. According to critics, this stemmed from a lack of communication and decision-making within the government.

Rebelo de Sousa said he would closely analyse the government to avoid "greater deterioration of institutions."