ECB’s Visco: Under Favourable Conditions, Italy’s Expansion Should Persist Over Medium Term

6 July 2021

By David Barwick – FRANKFURT (Econostream) – Provided the monetary and financial environment remains positive, Italy’s economic expansion should persist over the medium term, European Central Bank Governing Council member Ignazio Visco said Tuesday.

In a speech to an Italian banking association, a text of which was provided by the Banca d’Italia, which he heads, Visco said that in the context of a better situation with respect to the pandemic, Italy’s recovery was consolidating.

Helped in particular by investment, ‘growth would strengthen strongly’ over the second half, he said, hitting an average of ‘around 5%’ and thus ‘allowing for a recovery of more than half of the output fall recorded in 2020.’

‘With the support of fiscal policy, including the measures financed with European funds, and the maintenance of favourable monetary and financial conditions, the expansionary phase should consolidate and remain sustained over the next two years’, he said.

However, he added, there is still high uncertainty, given this outcome depends on continued pandemic containment, no delays in implementing the country’s recovery and resilience plan and continued relaxed conditions of credit access.

As noted by Visco, Banca d’Italia’s next economic bulletin would appear on July 16 and contain ‘a detailed update of our projections.’