Bank of Italy cuts 2018 GDP forecast to 0.9%

(ANSA) - Rome, December 14 - The Bank of Italy said Friday that it has cut its GDP growth forecast for 2018 to 0.9%, down from the previous prediction of 1.2%. The central bank's growth said that it forecasts growth will be around 1% in the 2019-2021 period, saying the high bond spread was factor holding the economy back.
    "The effects of the expansive measures in the budget on economic activity would be hindered by the higher interest rates registered up to now and those expected, which would counteract the expansion of domestic demand," the central bank said.
    Italy's bond spread has increased significantly in recent months. "Higher growth rates could be achieved if the sovereign spread levels returned to the values registered in the second quarter of this year," the Bank of Italy said.