Morgan Stanley Expects Lower Italian Growth at 0.5% in 2019

Italy will struggle to achieve the growth rate that the anti-establishment government has planned for 2019, according to Morgan Stanley.

In its latest 2019 budget draft plan, Rome forecasts a growth rate of 1.5 percent for 2019 — compared to Morgan Stanley’s latest forecast of just 0.5 percent for gross domestic product (GDP) next year. The figure showing the investment bank’s forecast is only one-third of the Italian government’s own estimate.

“We expect a contraction in economic activity towards year-end, mainly driven by domestic demand, both consumer spending and business investment,” the bank said in its European Economic Outlook note, published this week.

“Further out, the fiscal boost to growth will probably have some beneficial effects on consumption. But it’s unlikely to be so big as to result in an improvement of the public finances,” the note added.

The Italian government expects increased spending on infrastructure projects and providing people with more income will revive the subdued Italian economy.

via CNBC

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.