Given the uncertainty of the economic outlook, the rates will have to be raised gradually; it will be easier if pressures for wage increases linked to the rise in inflation prove limited, in part thanks to the fiscal measures designed to curb the higher energy prices and support the income of the hardest hit households.
The funding conditions for the economy will in any case remain broadly favourable. Italy’s high public debt reduces the margins available. Fiscal interventions must be clearly targeted and well calibrated to maximize their efficacy and to keep their costs down.