In the last quarter of 2022, Italy experienced no economic growth relative to the previous quarter. While investment levels and exports increased by 2% and 2.5%, private consumption contracted and government spending stagnated. Persisting bottlenecks affecting global value chains, rising energy prices, and uncertainty related to the Russian invasion of Ukraine have raised the Italian inflation rate, now at 11.75%, relative to the previous year. Unemployment is stable at 7.8%. The OECD economic outlook expects annual inflation to gradually decline throughout 2023, reaching almost 4% towards the end of the year, and to decrease to 2.7% until the end of 2024. GDP is expected to grow at an average annual rate of 3.5% until the end of 2024. This projection has been revised upwards compared to the last quarter, because the negative effect on GDP of ECB’s restrictive monetary policy (aimed at slowing down inflation) has been revised downwards. Unemployment is expected gradually increase and to stabilize at 8.5% in 2024.

April 2023