The Italian government is expected to announce a growth forecast of 0.9% for 2023 with a deficit of 4.3% in the upcoming Document of Economy and Finance (DEF) to be presented to Parliament. This comes amidst ongoing discussions on the National Resilience and Reconstruction Plan (PNRR) and as the EU prepares to restart the Stability and Growth Pact. Risks to growth, including high inflation driven by imported oil prices, remain a concern. The IMF's spring estimates, set to be released this week, are expected to provide further insights on global growth projections, with inflation and monetary policies of central banks being key factors to watch.
Signs of improvement in Italy's economy include a decline in expectations for consumer price inflation and a projected slowdown in prices charged by businesses in the next 12 months, as per the Bank of Italy's survey. However, concerns over inflation persist, and the government is taking a "prudent" approach to managing public finances amidst ongoing discussions on debt intervention proposals from the EU. While the current outlook appears more positive than earlier this year, with inflation slowing down and growth forecasts expected to be announced in the DEF, uncertainties and risks remain, and global economic trends, particularly regarding inflation and monetary policies, will be closely monitored in the upcoming IMF estimates.
