In Italy “there is a sharp slowdown in the economy after a year that was better than expected. These months until the summer have gone much better despite the very serious effects of the increase in the price of energy. For next year it will be very difficult to go much better than we think, that is, close to essentially zero growth. This was stated by the governor of the Bank of Italy, Ignazio Visco, on the sidelines of the works of the International Monetary Fund, underlining that we are “close to substantially zero growth” and that one cannot have “a broad-spectrum budget policy when you have a public debt like the one we have ».
According to Visco, “the IMF is a bit more pessimistic. In reality, the uncertainty surrounding these forecasts is very high: we cannot take them as timely ». However, it is not monetary policy that causes the economy to fall. “It’s inflation, because it takes away purchasing power, income. The Ukrainian crisis also takes away certainty in international trade. It is not monetary policy that creates this crisis: monetary policy tries to prevent the crisis from leading to a spiral that would have very strong and structural negative effects ”, highlights Visco.
«The two watchwords of central banks are ‘temporary’ and ‘targeted’: it is very difficult. It is clear that you cannot have a broad-spectrum budget policy when you have a public debt like the one we have, ”added the governor.