Italian business federation predicts higher inflation, slower GDP growth for 2023

ROME, Dec. 20 (Xinhua) -- Italy's post-pandemic economic recovery is likely to grind to a halt in 2023 due in large part to high inflation, the country's business sector association Confcommercio said Tuesday.

Confcommercio said that signs point to a "possible reversal of the economic cycle after seven quarters of strong recovery."

Although negative trends will be "partially mitigated by improving indications from the labor market and from improved household and business expectations," record-setting inflation rates will take their toll.

"Households suffer from high inflation in terms of reduced purchasing power," Confcommercio said.

It predicted inflation would reach 12 percent by the end of the year, a slight rise from Italy's National Statistics Institute's data showing prices were 11.8 percent higher in November than a year earlier.

October and November were the two highest year-on-year inflation figures recorded in Italy since the creation of the euro currency zone in 1999.

Confcommercio also said the trend of slowing economic growth would continue into next year. The recent slowdown in industrial production and demand from internal markets, it said, are both indicators of economic weakness going forward.

However, there has been an uptick in demand for services, the federation said, sparked in part by recovery in the tourism sector, which was previously crippled by the coronavirus pandemic.