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Italy Will Shrink by 2pc This Year, Says Central Bank Governor Ignazio Visco

Italy’s economy will shrink by around 2pc this year, the head of the Italian central bank has said, as he called for adopting a “new Italian spirit” to tackle the eurozone debt crisis.

by AFP

The news came as Italian Prime Minister Mario Monti slammed unnamed EU states for undermining the “credibility” of the eurozone and called for rapid action on agreed ways to resolve the debt crisis.

“Consensus forecasts indicate the GDP will shrink around 2pc,” Ignazio Visco said in an interview with the Corriere della Sera, revising down an earlier forecast.

At the end of May, Visco said the contraction could be kept to around 1.5pc.

“2012 will be negative, but if the situation does not get worse, if the risk on interest rates drops, if the crisis solution is shared on a European level, we could see light at the end of the tunnel by the end of the year,” he said.

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