ROME: The Italian economy will grow by 0.7%this year and by the same amount in 2024, national statistics bureau ISTAT said on Tuesday, cutting its previous projections made in June.
ISTAT’s forecast for next year is significantly below the estimate of 1.2% made in September by Giorgia Meloni‘s government, underscoring the challenge Rome faces to maintain growth momentum and meet its public finance targets.
In 2023 the government sees growth of 0.8%
In June, ISTAT had estimated growth of 1.2% this year and 1.1% in 2024.
In its twice-yearly economic outlook report, ISTAT said gross domestic product in the euro zone’s third largest economy would be supported both this year and next by domestic demand, with trade flows providing no boost to growth. Italian GDP edged up 0.1% in the third quarter from the previous three months, ISTAT reported last week, following a 0.4% decline between April and June.
ISTAT said on November 10 that economic activity would probably slow over the next few months, pointing to a weak fourth quarter.
In its report ISTAT estimated the government’s expansionary 2024 budget, which contains some 24 billion euros of tax cuts and increased spending, would increase growth by 0.2 percentage points next year, in line with Rome’s own estimate.
ISTAT estimated an average jobless rate of 7.6% this year, down from its June forecast of 7.9%. It cut next year’s forecast to 7.5% from 7.7%.
The unemployment rate stood at 7.8% in October, the latest data available.