ROME, ITALY – The Bank of Italy raised its forecasts for growth in the economy, to 0.7% this year and rising to 1.5% in 2016, while predicting a dip in the jobless rate next year.
The new forecasts for growth are stronger than the bank’s previous outlook for Italy’s gross domestic product (GDP) growth, of 0.4% in 2015 and 1.2% next year.
The estimates came in the central bank’s latest economic bulletin where the bank said it sees an improvement in the business outlook as well a small increase in inflation, suggesting an economic recovery is under way.
The Italian economy has begun to expand, the central bank said in its quarterly bulletin. Projections indicate the gradual strengthening of growth, which will still be limited this year but faster in 2016, thanks to a recovery in investment, which has been expanding since the start of the year.
Stimulus from the European Central Bank (ECB) through its Quantitative Easing (QE) program will continue to play an important role.
Loans taken by householders increased by 0.4% while business loans rose by 0.7%. At the same time, the costs of borrowing are on the decline, said the bank. Overall investment, while still below historic averages, is on the rise, the report said.
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