Posted By Global Banking and Finance Review
Posted on December 13, 2024
MILAN (Reuters) - The Italian economy will expand by 0.7% both this year and next, the country's central bank said on Friday, cutting estimates made in October as the monthly flow of data continues to weaken.
The projections are below those of the Italian government, which officially forecasts growth of 1.0% this year and 1.2% in 2025.
However, on Thursday Economy Minister Giancarlo Giorgetti said the euro zone's third largest economy will likely end the year with a growth rate of 0.7%, noting the deepening slump in the industrial sector.
The central bank's previous forecasts made two months ago envisaged growth of 0.8% this year and 0.9% in 2025.
The forecasts are not adjusted for the number of days worked each year, in line with the methodology used by the government, the European Union and other bodies for international comparisons.
If adjusted for the number of days worked, the Bank of Italy said that growth this year would be just 0.5%, accelerating to 1% next year.
That implies that the economy will stagnate again in the final quarter of this year, as it did between July and September, and is in line with a 2024 forecast issued this month by national statistics bureau ISTAT.
Italy's average EU-harmonised inflation rate should come in this year at 1.1%, the central bank said, unchanged from its October projection.
Inflation is seen accelerating to 1.5% in 2025, against the Bank of Italy's previous estimate of 1.6%.
(Reporting by Sara Rossi, editing by Gavin Jones)
