Italy’s modest Q2 2026 growth amid low unemployment and easing inflation

Italy’s economy showed modest expansion in the second quarter of 2026, with gross domestic product rising 0.2% on a quarterly basis and 1% year‑on‑year, according to provisional Istat data. The performance exceeds the Bank of Italy’s earlier forecast of a 0.6% increase by year‑end. Unemployment fell to 5.7% in June, down from higher levels a decade earlier, keeping Italy below the EU average of 6.0%. Inflation eased in July, with the national consumer price index at 2.8% annually, while core inflation in the euro area rose to 2.5% and energy prices continued to climb. Italy’s net external position remained stable, with a creditor balance of €351 billion at the end of March. Regional business leaders highlighted growth potential in the South, noting a projected 0.8% GDP rise for the Mezzogiorno in 2026, slightly ahead of the 0.7% forecast for the centre‑north, and called for structural reforms to sustain the momentum. Local commerce in Piacenza reported stable sales despite high summer temperatures, emphasizing the need for digital outreach and coordinated urban planning.