Italy's gross domestic product (GDP) will rise 1.1% in real terms in 2016, national statistics agency Istat forecast on Tuesday in its report on the Italian economy's prospects. The forecast is 0.3 of a percentage point lower than the agency predicted in last autumn.
But Istat stressed that its preliminary estimate of a 0.3% rise in GDP in the first quarter of this year showed that the economy was growing, albeit at a moderate pace. It also forecast that Italy's unemployment rate will drop to 11.3% this year from 11.9% in 2015.
It added that the current period of price deflation should end in the autumn, although the inflation rate will probably not go above 1% in 2016. Istat said rises in consumer spending and investments should gather strength too.
It forecast a 1.4% rise in household spending, fed by an increase in disposable income and an improvement in the labour market. The agency predicted a 2.7% rise in investment levels, thanks to expectations of growth and better conditions on the credit market.
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