MNI SOURCES:Italy May Revise Growth, Fiscal Forecasts On Virus

By Silvia Marchetti

     ROME(MNI) - Italy could revise estimates and adjust its budget deficit

estimates to take account of coronavirus in forecasts to be published in April

with the fiscal document set to form the pillar of the next 2021 budget law, a

government source told MNI, although another cautioned that the effect could

still be minimal.

     Italy's council of ministers has decided to prioritise dealing with the

virus, and discussion of legislation and meetings on other matters could be

postponed, sources said.

     An emergency decree expected in the coming days is likely to suspend tax

payments and services bills for families and firms in virus-hit zones in the

north of the country. Mortgage payments and monthly pension contributions from

workers who are currently unable to reach their workplaces may also be

suspended, and affected businesses will be granted access to Italy's Small- and

Medium-Sized Enterprises Guarantee Fund.

     Banking lobby ABI is working with the government on ways to suspend

mortgage payments, sources said.

     "It's too early yet to quantify the impact of the virus on our economy, or

globally. It (the effect) could still be temporarily, though there are risks it

could turn into a major blow for the global economy. But we need to see how the

first quarter goes," said a source with the Democratic Party, which shares the

governing coalition, "We will have a clearer idea by April when we set out the

fiscal framework."

     Another source said growth targets might be adjusted only slightly or left

unchanged.

     The government's virus response will employ the same protocol used to deal

with natural calamities like earthquakes, sources said.

--MNI London Bureau; +44 203 865 3829; email: jason.webb@marketnews.com

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