Overview

• The UPB trimmed its GDP growth forecasts by 0.1 percentage point for 2025 and 0.2 for 2026 to 0.5% based on April projections.
• The revision follows a 0.1% GDP contraction in the second quarter and acknowledges that a strong euro has eroded export competitiveness.
• Inflation is projected to average 1.8% over the 2025–26 period with employment expected to rise 0.5% in standard labour units.
• Downside risks stem from potential delays in PNRR project execution and an as-yet undefined 15% EU-US tariff agreement.
• The government’s spring public finance document still targets 0.6% GDP growth for 2025 despite the UPB’s downgrade.