Economic forecast S&P upgrades Italy debt outlook

The steps provide Italian authorities an opportunity to restart economic growth

WASHINGTON:

S&P Global Ratings held the grade on Italy’s government debt steady at BBB but upgraded the outlook to stable from negative, noting improved prospects to restart growth amid the pandemic. “The Covid-19 pandemic has hit Italy’s economy hard; under our projections, GDP will not return to 2019 levels until 2023,” the agency said in a statement. S&P estimates the Italian economy will contract by about 9% this year, before recovering by 6.4% next year. However, low interest rates and expanded measures by the European Central Bank (ECB) could provide a huge injection to the Italian economy. “In our view, despite macroeconomic uncertainties, these steps provide Italian authorities an opportunity to restart economic growth and to reverse the deterioration of its budgetary performance,” the statement said.

Published in The Express Tribune, October 25^th, 2020.

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