The new macroeconomic projections for the Italian economy in the three-year period 2024/2026 signed by the Bank of Italy have arrived. All while waiting for the Def. Here are the main estimates formulated by via Nazionale experts:
Italy’s GDP is expected to grow at a rate of 0.6 percent in 2024, 1 percent in 2025 and 1.2 percent in 2026. Economic activity would benefit from the recovery in foreign demand and purchasing power of families but still restrictive financing conditions and the reduction of incentives for residential construction would weigh on investments; Inflation is expected to decline sharply in 2024, to 1.3 percent, mainly due to the effects of falling prices of energy and intermediate products. The disappearance of this factor and the increase in wages would lead to a slight rise in the following two years, to 1.7 percent.
With one clarification. From Palazzo Koch they underline that the forecast scenario assumes that the international context, although uncertain, does not lead to particular tensions on the energy raw materials and financial markets. “It is estimated that product growth will remain limited during this year and will strengthen thereafter, thanks to the recovery in disposable income and foreign demand”, specifies Bankitalia which reports that “compared to the projections published in December, the growth of GDP is almost unchanged.”
Presenting the new estimates, Bankitalia warns, however, that the risks for growth are oriented downwards. “Slower growth could occur if the lack of dynamism in world trade persists for longer, in connection with the uncertainty that characterizes the recovery of the Chinese economy and with a possible worsening of international political tensions”. There is also the impact of monetary restriction to consider which could also be more pronounced than expected and have a more intense impact on domestic demand. Finally, the progressive reduction of incentives for the redevelopment of homes could translate into a more marked correction in activity in the construction sector than expected.