Ignazio visco, Governor of the Bank of Italy

Rome, Nov 3 Ratings agency Moody's has downgraded its outlook on Italy's economy, the latest in a series of worrying signs for the country.Moody's on Wednesday slashed its assessment of the country's banking system from "stable" to "negative", and said it expects conditions for the banking sector to deteriorate further over the coming 12 to 18 months, especially with regard to the performance of bank loans and broader earnings, reports Xinhua news agency.The news came in the wake of a series of downgrades in medium-term growth prospects for the economy from the Bank of Italy, the National Institute of Statistics (ISTAT), business lobby organisation Confindustria, the Organization for Economic Cooperation and Development, and the European Commission.In the most recent of these reports, ISTAT revealed that preliminary figures showed the economy grew by a stronger-than-expected 0.5 per cent in the third quarter of the year.However, ISTAT expected economic growth over the fourth quarter to be negative.The consensus among growth models is that the Italian economy will be flat next year after growth of around 3 to 3.5 per cent this year.On Wednesday, Moody's was even more cautious, predicting 2.7 per cent growth for this year as a whole, and zero growth in 2023.The challenges go beyond economic growth.The impacts of the war between Russia and Ukraine have pushed prices to record highs the latest data shows Italy's annual inflation rate hit 11.9 percent in October and sparked worries about access to energy and the reliability of key supply chains.Additionally, the fact that the euro has mostly traded in negative territory compared to the US dollar since August has eroded the buying power of Italian companies and residents.On Monday, Bank of Italy Governor Ignazio Visco called for the European Central Bank to raise interest rates in order to defend the euro against the dollar and other currencies.These factors have contributed to a broad decline in stock prices the Italian Stock Exchange in Milan is down nearly 20 per cent this year, despite minor gains in recent sessions and an increase in yields for government bonds.Italy's benchmark 10-year bond has traded almost exclusively above the 4 per cent threshold since late September, and was at 4.3 per cent at the close of Wednesday's session.Aside from a brief spike in June, the yield had not topped 4 per cent since 2014. Higher bond yields are a reflection of investor nervousness about an economy.Italy is Europe's fourth largest economy, and the third in the 19-nation eurozone.According to the most recent estimates, the country's economic growth rate this year should surpass the eurozone average, before falling back below the average in 2023.Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor

Home

City

Latest News

Cricket

LT Premium

National

International

Maharashtra

Opinions

Chhatrapati Sambhajinagar

Nagpur

Entertainment

Photos

Business

Technology

Sports

Lifestyle

Social Viral

Lokmat Games

Health

Pahalgam Terror Attack

Tahawwur Rana

IPL 2025

CM Devendra Fadnavis

Mumbai Local

Weather Update

Ignazio ViscoFOLLOW

Ignazio visco, Latest News

Politics :Italian economy facing downgrades amid inflation, energy concerns

Rome, Nov 3 Ratings agency Moody's has downgraded its outlook on Italy's economy, the latest in a series ... ...