In 2026 and 2027, Italian GDP is expected to grow by 0.9% and 0.6% respectively, after +0.6% in 2025. This was revealed by Istat, according to which economic growth would be supported by domestic demand net of inventories (+1.2 percentage points contribution in 2026 and +0.6 in 2027). Net foreign demand, however, would provide a zero contribution in 2026 and a slightly positive one in 2027. The growing trend in raw material prices should fuel an acceleration of inflation: the change in the household spending deflator would stand at +3.3% in 2026 and then decline to +2.8% in 2027.
The statistics institute observes that in the two-year period 2026-2027, consumption by families and private social institutions is expected to expand, but to progressively decelerate: we are talking about +1.0% and +0.6% respectively, compared to +1.2% recorded last year. According to Istat, consumption will be slowed down by the increase in prices, in the face of a positive but substantially stable trend in nominal gross wages per capita.
As regards the business world, the most recent data on the supply side continue to show signs of weakness in the sector and gross fixed investments would also show a slowing trend (+2.9% in 2026 and +1.0% in 2027 from +3.9% in 2025), mainly caused by the reduction, under current legislation, of public stimuli. Istat therefore explains more generally that in the two-year forecast period the Italian economy would continue to benefit from the stability of domestic demand, albeit slowing down compared to 2025.
Family consumption, despite the pressure deriving from the rise in prices on the dynamics of real wages, would be supported by the use of savings and the favorable performance of the labor market. Investments would continue to benefit, albeit to a progressively lesser extent, from the interventions still being completed within the Pnrr, but would be affected by the high uncertainty of the geopolitical scenario and the increase in energy costs. Exports and imports would instead continue to be supported by the positive dynamics of international trade.
Work
Employment (in terms of work units) would show a slowdown in growth in 2026 - to +0.9%, after +1.2% in 2025 - which would be accompanied by a further drop in the unemployment rate to 6% from 6.1% last year. In 2027, an even more limited expansion in employment is expected (+0.5%) and a further decline in the unemployment rate, to 5.9%. This is what Istat notes in the note on the performance and prospects of the Italian economy.
Industrial production
In September 2026, there is a cyclical recovery in seasonally adjusted industrial production after the decline recorded in August. Istat estimates that the index will increase by 1.2% compared to August. On average in the third quarter the level of production decreased by 0.4% compared to the previous three months.
The monthly seasonally adjusted index presents cyclical increases for capital goods (+1.3%) and intermediate goods (+1.2%); negative changes, however, were recorded by consumer goods (-0.2%) and energy (-1.4%). Net of calendar effects, in September the general index decreased in trend terms by 0.1% (the calendar working days were 22 as in September 2025). The reduction is larger for consumer goods and intermediate goods, while growth is observed for capital goods and, above all, for energy.
Towards a slight drop in oil prices
Growth in the euro area should be substantially stable both this year and next, also thanks to an easing of geopolitical tensions and the consequent slight drop in oil prices, but "the risks for the basic scenario remain oriented towards the downside".
Istat recalls that in 2026 the performance of the energy sector was marked by high volatility and a widespread upward trend, with Brent prices rising above the threshold of 100 dollars per barrel. At the same time, the natural gas market has shown strong fluctuations linked to supply uncertainty and logistics increases. For 2027, on the hypothesis of an easing of geopolitical tensions in the Middle East and a progressive restoration of normal trade routes through the Strait of Hormuz, a moderate decline in the price of Brent is expected during the year (to 96.1 dollars per barrel, from 97.8 dollars in 2026) while natural gas prices in Europe would remain at high levels (60.9 euros per MWh, from 58.8 euros in 2026) due to a combination of structural supply constraints, storage dynamics and logistical bottlenecks.
Overall, growth forecasts for the area highlight substantial stability for this year and next (+1.1% and +1.2% respectively, after +1.2% in 2025). In 2027, the growth of economic activity is expected to slow down both in Germany (from 1.3% to 1.1%) and in Spain (from 2.5% to 1.5%), while a moderate acceleration is expected in France (from 0.4% to 0.7%). However, the risks to the baseline remain skewed to the downside. The persistence of geopolitical tensions could reactivate inflationary pressures. At the same time, a reduction in productivity and profitability growth expectations linked to the use of artificial intelligence would risk triggering strong corrections on the stock market, with consequences for the real economy.
Pensions
"Comparing the current regime with the one proposed in the amendment, it is estimated that the pensioners involved will be just over 3.5 million, who will receive approximately 510 euros less on average in gross annual pension payments in 2027 than they would have received if the tiered calculation system had remained". This is what the president of Istat Francesco Maria Chelli claimed in the hearing in the Chamber on the maneuver regarding article 55 of the budget bill.
