Italy’s Economy Minister, Giancarlo Giorgetti, announced that the country will maintain its GDP growth forecasts of 0.6% for 2025 and 0.8% for 2026. This decision comes despite the uncertainty caused by recent U.S. import tariffs. Giorgetti stated that these potential impacts were already considered when the forecasts were first made in April. The country’s economy experienced a slight contraction in the second quarter due to negative trade flows, but a recent uptick in industrial output suggests some resilience in the manufacturing sector.
Fiscal Policy and Budget Plans
The Italian government plans to present its updated budget forecasts to parliament by October 2. Giorgetti expressed confidence that no further fiscal tightening would be necessary to keep Italy’s deficit below the European Union’s 3% of GDP ceiling next year, which would allow the country to exit the EU’s excessive deficit procedure. The government also intends to ease the tax burden on middle-income families, with one proposal from the co-ruling League party suggesting that national banks contribute over 1 billion euros to the 2026 budget to help finance these measures.
