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Bloomberg
Italian inflation surged to the highest in three decades as energy prices continued to rise following Russia’s invasion of Ukraine.
Prices increased 7% in March from a year earlier, statistics office Istat said. That’s the fastest pace since 1991.
Rising prices and the ongoing conflict are impacting the economy with Finance Minister Daniele Franco saying last week that Italian growth is set for a potentially significant downgrade.
The European Commission currently predicts a 2022
expansion of 4.1%, though economists see just 3.3%.
The government has spent more than 16 billion euros ($17.6 billion) on cushioning the impact of rising energy costs on families and businesses, and recently passed further measures including a tax cut on fuel prices at the pump. The Treasury is set to release its new budget plan soon and growth and deficit goals may be reviewed.
With high gas reliance and little protection for consumers, Italy will be the hardest hit major euro-area economy should the energy supply remain insecure and prices
elevated for the rest of the
year, according to Bloomberg Economics.
For now, Italian inflation still is slower than in Germany, where it touched 7.6% this month, or in Spain, where readings are approaching 10%.