Italian economy to shrink by 2 per cent this year, says Bank of Italy governor

Ignazio Visco has called for the adoption of a “new Italian spirit” in order to tackle the eurozone crisis.

ITALY’S ECONOMY COULD shrink by about 2 per cent during 2012, according to the Bank of Italy governor Ignazio Visco.

Visco’s statement reveals a starker assessment on Italian GDP for year when compared with his previous estimate, which predicted a contraction of 1.5 per cent. However, he also said that signs of recovery may be seen by the end of the year and called for the adoption of a “new Italian spirit” in order to tackle the eurozone crisis.

The Italian government had previously estimated that the economy would shrink by 1.2 per cent, while employers’ lobby group Confindustria forecast a figure of 2.4 per cent, Reuters reports.

Meanwhile, Italy’s Prime Minister Mario Monti blamed unnamed EU states for undermining the “credibility” of the eurozone, reports the Daily Telegraph. He agreed with Visco that the country was being unfairly punished by the markets.

Read: IMF head warns of ‘acute stress’ in Europe

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