The Bank of Italy sees inflation in the country at 2.2% in 2023 in its intermediate scenario that assumes that the war in Ukraine will continue for a long time, it said in its economic bulletin on Friday.
Growth in this scenario would be 2.2% this year –1.6 points less than foreseen in January-- and 1.8% in 2023 –0.7 points less. Inflation for this year would jump to 5,6%.
If the war ended soon and tensions eased, the Bank projected that inflation would be at 4% this year and 1.8% in 2023. Growth would be at 3% in 2022 and 3.1% in 2022.
In its severe scenario in which the conflict lasts and imports of Russian gas are halted in May, the BOI sees negative growth of “almost half percentage point” for this year and next. Inflation would jump to 8% in 2022 and 2.3% in 2023.