Wednesday, May 31, 2023
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Italian minister warns of risk of ECB raising rates

By Federico Maccioni

CERNOBBIO, ITALY (Reuters) – Italy’s economic outlook is improving but higher interest rates aimed at curbing inflation could weigh on growth, the economy minister said. Threat Saturday, a warning to the European Central Bank (ECB).

“It is not enough to fight inflation with monetary policy alone, recession cannot be the price of fighting inflation,” Giancarlo Giorgetti said.

Giorgetti is from the League party, which last month criticized the ECB for pushing ahead with its latest basis point rate hike amid turmoil in the banking sector.

At the Ambrosetti Business Forum, Giorgetti confirmed that the improvement in the first half of the year will allow Italy to slightly revise up 50 the official forecast for economic growth of 0.6%.

He added that it would be difficult for the EU to reintroduce budget rules that have been suspended until the end of ).

“In these crisis years, due to COVID and war, the relaxed political climate around budget rules is not going to make it easy to restore any rules,” he said.



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