Italian economic expansion to average around 0.75 percent in 2024-2026
Date
7/24/2024 3:04:24 AM
(MENAFN) On Tuesday, the International Monetary Fund (IMF) projected that Italy's economic growth will average around 0.75 percent for the period spanning 2024 to 2026. This forecast suggests a modest expansion for the Italian Economy over the next few years. According to the IMF, Italy is expected to experience ongoing disinflation, a trend where inflation rates decrease over time. However, the IMF notes that this projection comes with several caveats.
The IMF highlighted that stronger economic growth is achievable if Italy can improve its fiscal performance and stimulate higher levels of private investment. Effective fiscal management and increased investment could provide a boost to Italy’s economic trajectory. Nevertheless, the outlook is not without risks. The IMF pointed out that Italy's economic expansion could be adversely impacted by several factors. These include a potential escalation of regional conflicts, significant economic slowdowns in major trading partners, escalating geoeconomic fragmentation, and the possibility of unexpectedly high interest rates.
In terms of inflation, the IMF's assessment indicates a notable decline in headline inflation, primarily driven by falling energy prices. Core inflation, which excludes volatile items such as food and energy, has also shown signs of moderation. The IMF projects that inflation in Italy will fall below the 2 percent target in 2024. However, it is expected to return to this target level in the subsequent years. This forecast reflects a period of adjustment following the recent shifts in energy prices and broader economic conditions.
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