The EU cut its growth forecast for Italy and expects GDP to increase by 0.4% this year, compared with 0.7% in its spring forecast and 0.8% in 2026 (from 0.9%). Growth of 0.8% is then expected in 2027. In the Draft Budget Plan (Dpb) the government shows a forecast of growth of 0.7% in 2026 and 0.8% in 2028. This is what emerges from the European Commission’s autumn economic forecasts.
For Europe, economic forecasts for autumn 2025 show that growth in the first three quarters of the year exceeds expectations both in the European Union as a whole and in the Euro area. Estimates are that the Eurozone will end the year with a GDP increase of 1.3% (compared to 0.9% spring forecast) and the EU of 1.4% (from 1.1%). But for 2026, Brussels limited its growth forecast in the Eurozone to 1.2% and 1.4% in the EU.
Brussels then sees Italy ‘lagging behind’ the EU in terms of growth in 2027, with GDP growth forecast at 0.8% and the lowest value among the 27 countries, along with France (1.1%) and Germany (1.2%). The Eurozone economy is forecast to grow by 1.4%, while the EU as a whole is forecast to grow by 1.5%.
In contrast, stronger growth is expected in Ireland (2.9%), Spain (2%) and Malta (+3.5%). In 2026, Italy’s expected growth is second to last with 0.8%, better only than Ireland (0.2%). This year Italy is doing better (+0.4% in estimates) only than Finland (+0.1%) and Germany (+0.2%).
The Commission also estimates that Italy will end 2025 with a deficit-to-GDP ratio of 3%, 2.8% in 2026 and 2.6% in 2027. Brussels’ estimates are in line with the government estimates shown in the Dpb.
It is worth remembering that according to European economic governance, to exit the excessive deficit procedure, Italy must close 2025 with a deficit of less than 3%. For debt, Brussels estimates the ratio to GDP at 136.4% in 2025, 137.9% in 2026, and 137.2% in 2027.
ANSA Agency Istat: inflation slows in October, +1.2% on year – News – Ansa.it Initial estimates confirmed, -0.3% for the month. The ‘shopping basket’ price estimate has been revised down, +2.1% (ANSA) According to the European Commission’s Autumn Economic Forecast, in 2027 Italy will be one of four EU Member States to have a debt/GDP ratio above 100% – with an estimated debt/GDP ratio of 137.2% – along with Belgium (112.2%), Greece (138%) and France (120%).
Keep in mind that Italy’s deficit is seen at 2.6% in 2027, twelve countries will be above 3% in deficit/GDP ratio, with Germany at 3.8% and the highest value being Poland (6.1%) with Belgium and Romania (5.9%).
EU, downside risks to growth between import duties and geopolitics
Risks to Europe’s economic growth prospects are oriented to the downside. The European Commission stated this in its autumn forecast. “Ongoing trade policy uncertainty continues to weigh on economic activity, with tariffs and non-tariff restrictions potentially hampering EU growth more than expected,” it reported.
“Further escalation of geopolitical tensions could increase supply shocks – says EU executive -. At the same time, a reassessment of risks in stock markets, particularly in the US technology sector, could affect investor confidence and financing conditions. Domestic political uncertainty could also weigh on confidence”.
“Lastly, the increasing frequency of climate change-related disasters could undermine growth – Brussels also reported –. On the positive side, rapid progress on the reform and competitiveness agenda, greater defense spending focused on EU production and new trade agreements could support economic activity more than expected.”
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