Visco (Bankitalia): “Wages are growing below inflation. A reassuring indicator.” Recession only with stopping the gas

“Comfortable” indicators reach the front of theMedium to long-term inflation And from wage dynamicswhich does not seem at the moment to indicate the beginning of a serious escalation between prices and wages.” This was stated by the Governor of the Bank of Italy Ignazio Visco He speaks at the annual meeting of the Italian Banks Association. These signals reveal how the goal of bringing inflation back to line “by a The gradual normalization of monetary policy Without causing a sudden slowdown in the economy.” Visco said the slowdown in GDP and “the risk of a contraction in economic activity” should prompt banks to “take this into account” in their “dividend and provisioning policies,” and welcomed similar calls he had received. Central Bank in recent days.European.

“Italy will end up in recession only in the event of a scenario of blocking gas supplies from Russia,” Visco then stated that under this opposite scenario, GDP (which should grow in line with the eurozone in the biennium) would suffer “average contraction Biennial 2022-23, To return to growth in 2024. There will be “direct repercussions for this outage on the sectors with the highest energy intensity, a further increase in raw material prices, a marked slowdown in foreign trade, a deterioration in confidence and an increase in uncertainty.”

Interest rate hike (scheduled for summit on July 21, so) “It shouldn’t slow down” the trend of bank loans, says Visco who points out The impact on bank profitability will be generally positive Thanks to the expansion of the interest margin, the performance of which will depend on the maturity structure of the assets and liabilities of individual banks, even with significant differences between brokers.”

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“Reactions to the financial markets that are not justified by the fundamentals of different countries can be countered, by the decisive use, as in the past, of all the instruments at the disposal of the Central Bank and, if necessary, by using new ones,” Visco stated regarding the measures under consideration in Frankfurt. To reduce the excessive expansion of Yield spreads (spread) between the various countries of the eurozone. “For central bank actions to be effective, it is critical that there is no inflating the cost of funds in individual jurisdictions (countries). so)”, adds the ruler

‘More selective’ billing interventions For the just ended quarter “We appreciate strong growth, Which makes the growth gained for 2022 “above 3%”. Economy Minister said: Daniel Franco, in the ABI complex. in the quarter industrial production increased, According to Mef’s estimate of 2%. The government “intends to continue” measures to contain the impact of expensive energy, but Interventions will be ‘more selective’ The minister explained that the economic situation of families is being “calibrated”. The increase in prices is related to energy.”It doesn’t look like it’s going back Quickly” says Franco, explaining that the overall picture “severely deteriorated” with Russia’s invasion of Ukraine. “Increasing energy is particularly important,” he said. One of the goals Italy should aim for in order to counteract the potential risks of a “setback” for the economy is to “increase The employment rate, which is particularly low, given the youth, women and the South.” In this sense, “reducing the tax wedge is a priority”He added, explaining that the issue will be dealt with in the budget law.

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Head of ABI – Operations Consolidation ‘banks “They should also develop internationally, especially in Europe, to encourage the growth of banking entities that compete with the American and Asian giants,” said President Abe. Antonio Batueli Intervened before Visco. The president recalled how in our country “bank mergers took place within the framework of Constant tough competition. In proportion to the population, there have been more banking mergers in Italy than in other countries in the rest of Europe.”

‘Biggest protection strategies for health and environment It must be prioritized” and “banks are committed to a more sustainable economy, and must always better assess climate risk,” says Patuanelli who nonetheless explains how credit institutions “should not be seen as substitutes for public authorities and functions and should not be overburdened.” additional capital requirements.

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