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Italy’s GDP Growth Forecasted at 0.4% in 2025, Public Debt to Rise

Rome, February 2, 2025 – The Europe Today: Italy’s economy is projected to grow by 0.4% in 2025, with the fiscal deficit increasing from 3.3% to 3.6% of GDP, and public debt rising by 1.5 percentage points to reach 138.4% of GDP, according to estimates released by the Observatory of Italian Public Finance (OCPI) at Milan’s Catholic University. The report was published following GDP data from ISTAT.

For 2024, the OCPI expects real GDP growth to close between 0.6% and 0.7%. Despite the rising deficit, the report indicates that Italy will largely remain compliant with European fiscal rules, though there will be a one-year delay in meeting the EU’s deficit-reduction parameters under 3% of GDP.

Initial estimates from ISTAT, released on Thursday, showed that Italy’s GDP remained stagnant in the fourth quarter of 2024 compared to the previous quarter, registering a 0.5% year-on-year increase from the October-December period in 2023.

ISTAT reported that Italy’s GDP grew by 0.5% in 2024 compared to 2023, based on seasonally and calendar-adjusted data, noting that 2024 had four additional working days. In contrast, the government had previously estimated a 1% growth rate for the year in non-calendar-adjusted terms.