Overview
The Bank of Italy indicated that Italy’s economy expanded at a slower pace in the second quarter of 2026 compared with the first three months, when gross domestic product (GDP) grew 0.3 %.
Economic Activity
During the spring months, investment activity weakened and household consumption fell, contributing to the deceleration. The slowdown coincided with a sharp rise in energy prices triggered by the war in Iran, which is expected to widen Italy’s energy deficit.
Energy Deficit Outlook
The central bank projects that the energy deficit will increase by roughly half a percentage point of GDP in 2026 and then gradually decline in the following years.
Growth Projections
In June, the Bank of Italy forecasted annual GDP growth of 0.5 % for 2026 on a seasonally‑adjusted and working‑day‑adjusted basis. Incorporating recent revisions released by ISTAT, the expected growth rises to 0.6 %.
Tourism Impact
International tourist arrivals experienced only temporary effects from the Middle‑East conflict. Visitors from the Middle East, who account for 2.5 % of foreign tourist spending in Italy, dropped sharply in March and April year‑on‑year. Visits from non‑EU countries also fell temporarily but recovered in May and June.
Source Note
The article was generated with AI assistance and reviewed by an editor.