Italy in recession for two years if Putin turns off the gas. Bank of Italy, forecast by Ignazio Visco

Italy in recession for two years if Putin turns off the gas.  Bank of Italy, forecast by Ignazio Visco

If Russian President Vladimir Putin “cuts off the gas”, Italy ends up in recession for two years. Bank of Italy Governor Ignazio Visco, speaking at the ABI meeting, returned to the hypothesis of a total blockade of Moscow’s energy supply. “In a scenario of “supply stop” from the third quarter of this year, only partially replaced by other sources, the product would register a contraction in the average of the 2022-23 biennium, to return to growth in 2024 “.

Bakitalia’s number one explains that the deterioration of the macroeconomic situation “would contribute to the direct repercussions of this interruption in the most energy-intensive sectors, further increases in raw material prices, a more decisive slowdown in foreign trade, a worsening of confidence and a increase in uncertainty”.

“Last January we expected an increase in output of more than 3 percent on average for the 2022-23 biennium,” recalled the governor, explaining how the forecasts “were wrong, it is true, but the analyzes show that the error depends. 90% of the assumptions made regarding energy costs.” Now, “in the baseline scenario drawn up in June, in which war-associated tensions are assumed to continue through 2022, but excluding the suspension of gas supplies from Russia , growth was revised downwards, by 2 percentage points in the two years as a whole, in values ​​close to those of the euro area”. In conclusion, “the Italian economy is expected to grow in line with the euro area in the biennium 2022-23. However, the risks at a global level are significant.”

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Source: Iltempo

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