Italy will stick to its GDP growth forecasts of 0.6% for 2025 and 0.8% for 2026 in its upcoming budget plan, Economy Minister Giancarlo Giorgetti said Sunday, despite uncertainties tied to U.S. tariffs.
The estimates, first issued in April, already considered potential fallout from shifting trade conditions. “We feel confident in confirming GDP estimates for these years,” Giorgetti said at a political event in Rome, noting that the trade war’s impact had been factored in.
Italy’s economy contracted 0.1% in Q2, largely due to weak trade flows, but industrial output rose 0.4% in July, signaling resilience in manufacturing. Updated GDP and multi-year budget targets will be presented to parliament by Oct. 2, forming the basis for next year’s budget.
Giorgetti added that no new fiscal tightening would be needed to cut Italy’s deficit below the EU’s 3% ceiling, potentially ending its excessive deficit procedure. He reiterated pledges to ease taxes for middle-income families, though funding details remain unclear.
Reports suggest the ruling League party wants banks to contribute over €1 billion ($1.17B) to the 2026 budget.