Italy’s Economy to Grow at Least 5.8% This Year, Minister Says

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Italian Finance Minister Daniele Franco said the country’s economy will expand at least 5.8% this year amid the pandemic recovery, which may allow the government to improve deficit and debt targets.

“We are seeing a significant economic recovery,” Franco said Sunday at the Ambrosetti Forum in Cernobbio, northern Italy. 

The new forecast compares with a 4.5% projection announced in April and is roughly in line with expectations of economists surveyed by Bloomberg. In its outlook earlier this year, the government estimated debt of almost 160% of gross domestic product and a budget deficit of 11.8%.

Italy is enjoying its strongest economic rebound since the 1970s as the world emerges from the coronavirus crisis. Construction and communication activity are above pre-Covid levels, and the government is said to be working on a new fiscal law worth about 20 billion euros ($24 billion) to sustain measures supporting families and businesses.

“Italy will keep an expansionary monetary policy,” Franco said in his speech Sunday.

Prime Minister Mario Draghi warned earlier this week against complacency on the strong economic rebound. 

“Those that have fallen the most are bouncing back the most,” Draghi said Thursday. “The true challenge will be to keep the growth rate considerably higher than what it was before the pandemic, that’s where we’ll see the economy’s ability to become structurally more solid.”

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