Other things being equal, the budget measures contained in the decree, which are indispensable to avert still worse scenarios, will inevitably have a negative impact on economic activity. Going by the historical pattern, the impact of the additional measures on GDP can be estimated as amounting to about half a percentage point over the next two years.
However, this restrictive effect may be countered by the positive effects of increased confidence in Italy’s ability to honour its debt and improving medium-term prospects for  4  BIS central bankers’ speeches  economic growth. A reduction in the cost of finance to the public sector and to households and firms could favour growth in the immediate.