The Bank of Italy published an economic update for Emilia-Romagna showing estimated output growth of 1% in the first half of 2026 compared with a year earlier, slightly above the national rate. Recovering industry and exports, rising household consumption and investment supported activity. Bank lending accelerated, but higher energy costs weighed on corporate margins and household purchasing power.
Industrial activity continued the recovery that began in late 2025 after more than two years of contraction. Exports increased 3% in nominal terms, with growth in European Union markets offsetting declining sales elsewhere. Services expanded, supported by tourism and transport, while construction remained broadly stable despite public investment support. Employment rose 1.4%, more than twice the national pace, and unemployment fell to 3.8%. However, regional inflation reached 4% in September, driven largely by transport, housing and utility costs. Around two-thirds of surveyed industrial and services firms reported that higher energy costs had reduced profit margins. These pressures and geopolitical tensions posed downside risks, although surveyed firms expected sales growth to continue in the final quarter of 2026 and the first quarter of 2027.
Annual growth in bank lending to the private nonfinancial sector reached 2.9% in June, up from 1.5% in December 2025. Business lending increased 2.3%, driven by medium-sized and large companies, while loans to smaller firms continued to contract. Household borrowing also expanded, supported by mortgages and consumer credit. Banks modestly eased corporate lending conditions, mainly through lower average spreads, although conditions tightened further for construction firms. Credit quality improved slightly, with the annualized rate at which loans became nonperforming declining to 1% in June from 1.1% in December 2025.