Bank of Italy sees growth improving to 0.8% in 2020

Friday, 12. July 2019 17:18

The third-largest economy of the Eurozone will expand only 0.1% this year after 0.7% in 2018, the Bank of Italy said on Friday in a bulletin. Growth in the first quarter was 0.1% after a decline of 0.1% in the previous three months. Authors of the report added the rate should jump to 0.8% next year and by another 0.2 percentage points in 2021. They calculated in the effect of trade wars, ample monetary stimulus and high spreads in yields on national debt against benchmarks.

The update included unfavorable developments in investments and exports and revealed belief of a recovery in activity in by the end of the year, fueled by household consumption and an improvement in shipments to overseas. Industrial production in Italy fell 0.7% in the second quarter, according to the numbers. The government projected economic growth at 0.2% for this year and the Bank of Italy's estimate was 0.6% in January.

The prediction for inflation in 2019 was set at 0.7%. The document points to unknowns about fiscal policy "from next year on" and stresses it affects markets and investment plans.

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