Italy’s Economic Growth to Be Moderate for This Year and the Next

The Bank of Italy announced that the Italian economy is expected to grow by 0.8% this year, with further growth projected at 0.9% in 2025.

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Fitch

Italy

These forecasts are slightly lower than the central bank’s previous estimates released in July. In contrast, the Italian government predicts higher growth, with a rate of 1.0% for this year and 1.2% for 2025.
The Bank of Italy also stated that the average inflation rate is expected to remain at 1.1% this year, in line with July’s forecast, while inflation is projected to rise to 1.6% in 2025, compared to the previous estimate of 1.5%. These figures reflect the economic challenges Italy continues to face, amid the broader economic conditions in the Eurozone, which may require actions to support growth and enhance economic stability.

Fitch

Fitch downgrades France’s credit rating
it Ratings placed France in the “negative outlook” category just one day after the government presented its 2025 budget,
marking a swift critique of Prime Minister Michel Barnier’s efforts to address the sharp deterioration in public finances.

This announcement comes after Fitch had already downgraded France’s credit rating from (AA) to (AA-) in April last year,
the same rating given to both the UK and Belgium.

In a statement on Friday, Fitch said: “Fiscal policy risks have increased since our last review.
” It added, “The projected fiscal slippage this year will place France in a more difficult financial position,
and we now expect a wider fiscal deficit, leading to a rise in government debt to around 118.5% of GDP by 2028.”

This warning highlights the scale of the financial challenges facing France, as the situation rapidly worsened in 2024 due to weaker tax revenues, creating a budget gap.
President Emmanuel Macron’s decision to dissolve parliament led to months of political uncertainty and policy paralysis.

This scenario has prompted investors to sell French bonds, causing the yield spread between French and German 10-year bonds to widen to nearly 80 basis points, up from less than 50 points at the start of the year.

Italy’s Economic Growth to Be Moderate for This Year and the Next

Italy&#8217;s Economic Growth to Be Moderate

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Italy’s Economic Growth to Be Moderate