Moody's upgrades Italy's 2026 growth outlook and confirms stable credit rating

Moody's latest sovereign assessment confirmed Italy's Baa2 credit rating and a stable outlook, easing fears of market turbulence. The rating agency upgraded its estimate of Italy's economic expansion for 2026, pointing to a robust first-half of the year. It praised the Italian economy's structural strength, noting its ability to absorb energy-price shocks linked to the Middle-East conflict.

Moody's also cited the country's large, diversified, high-income profile and a strong domestic investor foundation that underpins government financing. The report commended the Ministry of Economy's prudent fiscal stance, aligning with EU targets for deficit reduction. Finally, Moody's stressed that continued fiscal consolidation and structural reforms would further improve Italy's debt trajectory.