The State projects that the Italian GDP will grow by 1% in 2024 and 1.1% in 2025, showing a moderate acceleration compared to 2023. This estimate is part of the prospects for the Italian economy in 2024-2025. In 2024, the increase in GDP will be supported by contributions from domestic demand net of inventories and net foreign demand, with inventories still having a negative contribution. In 2025, the growth of the Italian economy will be mainly driven by domestic demand. However, the scenario remains uncertain due to geopolitical tensions internationally.
For gross fixed investments, a deceleration trend is expected in the next two years, influenced by the lack of fiscal incentives to construction which will be offset by the effects of the measures in place and reduced interest rates. Istat also predicts a gradual return to inflation rates close to the ECB’s targets in the coming months. This will result in a decrease in the spending deflator of resident families in 2024 followed by a moderate increase in 2025.
Employment is expected to grow in line with GDP, accompanied by a decline in the unemployment rate. According to Istat’s latest report on corruption in Italy, although corruption is still a widespread practice, it is decreasing. The report highlights the various forms of corruption in the country, showing decreases in requests for money or other things in exchange for benefits, goods, or services.
Private consumption continues to be supported by the labor market and increasing wages but is constrained by an increase in the propensity to save. Overall, there is expected to be moderate growth in household consumption in 2024 and an acceleration in 2025. The dynamics in the Italian economy are expected to be influenced by both domestic and international factors moving forward.