Italian GDP is expected to grow by 1% in 2024 and 1.1% in 2025, a moderate acceleration compared to 2023 (+0.9%). Istat estimates this in the statistics “The prospects for the Italian economy in 2024-2025”. In 2024
the increase in GDP would be supported by the contribution of both domestic demand net of inventories and net foreign demand (+0.7 percentage points for both), with a contribution from inventories still negative (-0.4 points). In 2025, growth would instead be driven mainly by domestic demand (+0.9 points). In the April Def, the trend estimate is 1% growth this year and 1.2% next.
Private consumption is holding up
Private consumption continues to be supported by the strengthening of
labor market and by the increase in wages in real terms, but held back by an increase in the propensity to save. These dynamics will determine for 2024, moderate growth (+0.4 percent) in household consumption and a subsequent acceleration in 2025 (+1 percent). For gross fixed investments, a deceleration trend is expected in the two-year forecast period (+1.5 percent and +1.2 percent in 2024 and 2025 respectively, from +4.7 percent in 2023), determined by the lack of fiscal incentives for construction, which will be compensated both by the effects of the implementation of the measures envisaged by the Pnrr and by the reduction in interest rates .
Prices slowing down
The disinflationary process started in 2023 continued in the first months of 2024. The growth rate of the consumer price index for the entire community (NIC), which fell during 2023 from 10% in January to 0.6% in December, in the first five months of the year remained below
of the unit, amounting to 0.8% both in April and, according to provisional data, in May. This trend benefited from the drop in the prices of energy goods, a significant reduction in the trend inflation of food goods and the stabilization of the growth in prices of services at levels
lowest since May 2022. The trend dynamics of energy goods prices in the first five months of the year continued to show a contraction, albeit with a tendency towards deceleration (from -20.5% in January to -11.7% in May).
Brakes the shopping cart
The growth in food prices decreased, in trend terms, from 5.6% in January to 2.2% in May (preliminary data), due to the slowdown in the dynamics of both processed foods (from +4.5% % to +2.1%), and fresh food, (from +7.5% to +2.3%). Inflation relating to the “shopping cart”, a summary of the prices of food, home and personal care goods, which has been decreasing since the beginning of 2023, decelerated further in the first months of the yearfalling from 5.1% in January to
2.0% in May.
Prices for services are falling slowly
The decline in prices in services was slower: decreasing in the second half of 2023, in the first four months of 2024 it stabilized at around +3%, before settling at 2.7% in May. Among services, the prices of recreational, cultural and personal care services continue to show relatively higher growth (+3.7% in May) and those of housing-related services (+2.7% in May). average trend increase between January and May). Inflation relating to transport services, which recorded an average of +4.2% in the first three months of 2024, instead recorded a notable deceleration both in April (+2.7%) and in May (+2, 4%). Core inflation for consumer goods for the entire national community, net of energy and fresh food, has been progressively decreasing since the peak in March 2023 (when it reached 6.3%), it fell below 3% since last January (+2.7%) reaching, according to provisional data, 2% in May.
The international framework
The forecast scenario – reports Istat – remains characterized by the persistence of high uncertainty in the international context, determined by the evolution of geo-political tensions. However, the international economy maintained a positive growth rate in the first part of 2024,
albeit with different trends between the various geographical areas. Inflation slowed faster than expected, thanks to falling energy commodity prices and the effectiveness of restrictive monetary policies. Labor market conditions remained solid in many areas, with unemployment rates at record lows.
The forecasts of the EU Commission
The most recent forecasts from the European Commission show a marginally accelerating global GDP trend this year and next (+3.2% and +3.3%, from +3.1% in 2023), characterized by still heterogeneous performances between countries and regions; however, uncertainty remains high, especially due to the unpredictable evolution of geopolitical tensions. Markets anticipated the imminent reversal of the monetary policy cycle in Europe, while the timing of the Federal Reserve’s decisions remains uncertain given the still high dynamism
of the American economy, the solid conditions of the labor market and the stickiness of prices in some sectors.
The focus on the United States and China
Based on the reading of the latest available data, the main economies recorded a heterogeneous dynamic: in China, in the first quarter, GDP grew by 1.6% on a quarterly basis, accelerating from 1.2% in the three months previous ones. Although the data is consistent with the objectives of
Government, the Chinese economy remains characterized by some critical issues linked to the real estate sector and the high indebtedness of the private sector and local authorities. US economic activity in the first quarter grew by 0.3% on a quarterly basis, a marked slowdown compared to the previous period (+0.8%). Fixed investments, private consumption and public spending contributed positively to growth, while the increase in imports and inventories had a negative impact.
The growth of the euro area
In the Euro Area, the most recent macroeconomic data was better than expected. GDP in the first three months of 2024 increased by 0.3% on a quarterly basis, after the slight contraction in the previous two quarters (-0.1% in both). This result summarized a heterogeneity between the main countries, with Spain growing by 0.7% in economic terms, France and Germany by 0.2%..
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