The Bank of Italy published the 2025 Q1 Survey on Inflation and Growth Expectations, based on responses from Italian industrial and service firms with 50 or more employees, with the sample expanded from 1,500 to 2,500 units. Firms continued to report a deterioration in the overall economic environment and in their own short-term business conditions, but assessments of sales trends for the current and next quarter improved and employment was expected to grow across all sectors with largely moderate wage increases. Consumer price inflation expectations increased across all time horizons, although they remained below 2%. The sales improvement was strongest in manufacturing and was driven by foreign demand, while uncertainty and concerns over the direct or indirect effects of US trade policies weighed on the business outlook for the year. Construction remained more upbeat than the rest of the economy, though firms operating mainly in residential building reported a slowdown. Investment conditions were still viewed as unfavourable, but firms expected nominal investment spending to rise in 2025; access to credit was assessed as stable and liquidity as adequate overall. Over the past 12 months selling prices rose at a marginally faster pace in industry and slowed in services and construction, with moderate price growth expected over the next 12 months.
Bank of Italy 2025-04-08
Bank of Italy releases 2025 Q1 survey showing inflation expectations rising but still below 2% and sample expanded to 2,500 firms
The Bank of Italy's 2025 Q1 Survey on Inflation and Growth Expectations reveals that Italian firms report a deteriorating economic environment, though sales trends and employment are expected to improve. Consumer price inflation expectations have risen but remain below 2%. Manufacturing sales are driven by foreign demand, while investment conditions are seen as unfavourable despite stable credit access and adequate liquidity.