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.
ALL RIGHTS RESERVED © Copyright ANSA