Economy: IMF forecasts modest growth for Italy, cuts estimates for France and Germany

The International Monetary Fund (IMF) confirms growth of 0.5% for Italy both this year and in 2027. The figures are set out in the World Economic Outlook published on Wednesday.

They are "modest but expected" levels, noted the Fund's deputy director of research, Petya Koeva Brooks. "The investments planned under the NRRP (National Recovery and Resilience Plan) continue to support economic activity. At the same time, higher energy and food prices and elevated uncertainty are weighing on household consumption," Brooks said.

As for inflation, "the forecast has been revised upwards, partly because of greater dependence on energy imports, and we expect it to remain above target until 2028," she added.

The World Economic Outlook also confirms its projections for the Spanish economy at 2.1% and 1.8% GDP growth in 2026 and 2027, while the forecasts for France and Germany are revised downwards for 2026.

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What the IMF expects for the main EU economies and the rest of the world

The Fund identifies developments in the Middle East as the most immediate risk in its report.

"An escalation in geopolitical tensions would harm growth and worsen inflationary pressures. That said, if the reopening of the Strait of Hormuz were to proceed more smoothly than expected and commodity prices were to come in below the baseline scenario, growth could be higher and inflation lower," the outlook states.

France is expected to grow by 0.6% this year, 0.3 percentage points less than forecast in April. For 2027, growth is estimated at 0.9%.

For Germany, the Fund projects GDP growth of 0.7% this year and 1.0% next year.

The Chinese economy, by contrast, is forecast to grow by 4.6% in 2026 and 4.1% in 2027, confirming a slowdown from last year's 5%, once seen as the critical threshold for the stability of Beijing's politico-economic system.

The Brazilian economy is projected to grow by 2.4% at the end of 2026, before slipping by two percentage points the following year, in line with the Latin American average, whose growth is also estimated at 2.4% year on year compared with 2025.

Forecasts for Africa are broadly stable, averaging between 4.3% and 5.2% for this year, but with major internal differences. Among the largest economies, projections range from Nigeria's 4.3% growth in 2027 to just 1.3% for South Africa.

The IMF's warnings and possible solutions

Alongside concerns over energy costs, the outlook highlights worries about fertilisers and foodstuffs. In 2026 the prices of the former could rise by a total of 26% and those of the latter by 8%, driven up by higher energy and transport costs.

Overall global inflation is therefore expected to increase to 4.7% in 2026 (revised up by 0.3 points compared with previous expectations, from 4.1% in 2025), before falling to 3.9% in 2027, indicating that "the disinflation trend under way since the start of 2024 has come to a halt".

The IMF concludes with a series of recommendations, including some for central banks. "Policy priorities are to restore price stability, backed by clear communication, central bank independence and robust financial supervision, while rebuilding fiscal buffers and using fiscal policy tools sparingly.

"Structural reforms are needed to promote energy security and preparedness for artificial intelligence," the Fund's economists conclude.