00:00Let me begin, as usual, with the key messages emerging from our forecast.
00:09First, compared to the previous one, the winter forecast, published the 10th of February,
00:19growth in the EU economy is revised lower and inflation higher.
00:24We now forecast the EU economy to grow by 2.7% this year, before slowing further to 2.3
00:35% next year.
00:37For 2022, this is 1.3% lower than projected in February, so one of the steepest between forecasts, downgrades.
00:51Annual inflation is expected to hit an all-time high of 6.8% this year and to fall to
01:013.2% next.
01:04Second, the war has clearly exacerbated the headwinds that were previously expected to gradually fade.
01:12This includes the sharp rise in commodity prices and the aggravation of existing supply-side disruptions,
01:20as well as the emergence of new ones, for instance, in transport and logistics.
01:26Third, a strong and improving labour market, decreasing household saving rates,
01:34favourable financing conditions and the full deployment of the RRF are set to support the economy.
01:44Fourth, deficits and debt ratios are forecast to decline this year.
01:50Next, governments, as you know, are in the process of phasing out the COVID-19 universal emergency support,
02:01and the cyclical rebound in revenues is in full swing.
02:05So the aggregate budget deficit in the EU should decline from 4.7% in 2021 to 2.5%
02:14in 2023.
02:15For Italy, the short-term outlook remains subdued,
02:20as the war has dented economic sentiment and exacerbated existing obstacles to growth.
02:26Still, real GDP is projected to increase by 2.4% this year.
02:33Next year, growth forecast is at 1.9%, supported by RRF-financed Investments.
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