S&P raises Italy's rating to BBB+: recognition for sound public accounts

New promotion for Italian government debt. It came late in the evening of Friday 11 April from S&P Global Ratings, which raised its rating on Italian debt to BBB+ (from BBB). 'The seriousness of the Italian government's approach has been rewarded,' Economy Minister Giancarlo Giorgetti commented warmly. "Prudence and responsibility will continue to be our course of action." The move, which comes after the confirmation of the triple B rating with a positive outlook arrived from Fitch last week, comes as a surprise, at least looking at the storm unleashed by the Trump administration on global trade, international economic growth and therefore the prospects for the more fragile public accounts on the debt side. The astonishment is less intense if one looks at the fundamentals of the Italian public budget so far. Because with the results achieved at the end of 2024, which exceeded expectations by five decimals of GDP in the debt (135.3% of GDP instead of 135.8%) and by four in the deficit (3.4Fundamentals% instead of 3.8%) it has built a buffer capable of withstanding at least the first blows delivered by US neo-protectionism.

This is confirmed by the Public Finance Document expected to be examined by the Houses of Parliament next week. This year's growth is halved compared to the forecasts of the Structural Budget Plan, from +1.2% to +0.6%. But despite this, the deficit remains firm at 3.3% of GDP calculated in the autumn and the debt comes to 136.6%, stopping 7 billion below forecasts (Sole 24 Ore yesterday).

In such hectic times, in which the scenario changes in a matter of hours, analyses focus on underlying trends. Which also play in favour of the sustainability of the Italian accounts on another delicate side, that of state guarantees to cover loans disbursed with particular intensity at the time of the pandemic.

As of 31 December, explains the census just updated by the Public Finance Document, the stock fell again to EUR 294 billion, down from the EUR 300 billion return calculated 12 months earlier, continuing the downward trend from the peaks of 2021.

The market seems to share these estimates. The honeymoon between Italy and investors, on the public debt front, has been going on for some time now: partly because of the fact that the government is showing that it is holding the bar straight on public accounts, and partly because other countries in Europe have had far more problems lately. For example France, which has seen the spread of its ten-year government bonds rise to 78 basis points. The fact remains that the market has long since taken our BTp bonds off the list of problems. And has put them on the list of opportunities.