GDP, Confindustria: 2026 proves to be better than expected, but growth slows towards the end of the year

The outlook for 2026 is better than expected compared with April, thanks to two strong first quarters, but growth is set to slow towards the end of the year. This is the message from ‘Congiuntura Flash’, the analysis by Confindustria’s Research Centre. The continued near-total closure of the Strait of Hormuz is keeping oil and gas prices at their highest levels since the end of 2022 (though still well below the 2022 average). Inflation is rising and central banks are raising interest rates to curb it. This will slow down consumption and investment, including in Italia, whilst at the same time the boost from the National Recovery and Resilience Plan (PNRR) comes to an end in the third quarter of this year.

The forecasts for 2026 have, however, been revised upwards: +0.8 per cent compared with April (+0.5 per cent), thanks to the positive performance in the first two quarters. There are various reasons for this: the unexpected fall in global demand for oil, which has prolonged the period of scarcity; the fact that price rises have been passed on to non-energy goods to a lesser extent; and the boost provided by the National Recovery and Resilience Plan (PNRR) as it enters its final stages.

Specifically, the situation in the oil market remains tense, with the volume of traffic passing through the Strait of Hormuz at a low level – 13 per cent of normal. The price of Brent crude is high and volatile. The price of gas in Europe has risen to 77 euros per MWh (33 in February), much higher than normal levels (14 euros in 2019). Inflation in August reached its highest level of the year, at +3.3 per cent year-on-year, up from 1.0 per cent at the start of 2026. It is being driven upwards by consumer energy prices, particularly fuel, which are up 17.1 per cent (from -6.2 per cent). Various goods may incorporate higher (transport) costs in the coming months.

This is leading to a rise in interest rates: the European Central Bank has raised its rate to 2.50 per cent, and the markets are expecting further ECB rate rises between the end of this year and next year (a total of +1.25 percentage points). The Fed has also begun raising rates, following a period of stability that had lasted since January.

As regards sectors, industry is holding up: in July, industrial production rose by 0.7 per cent, driven by consumer goods, up 2.1 per cent. The year-to-date change for 2026 shows variation across sectors: the automotive sector is recovering (+8.8 per cent), whilst other transport equipment and computers and electronics are growing; furniture, textiles, clothing and leather goods, and chemicals are down. However, the August PMI fell below the neutral threshold (49.6).