Italy

Carries one of the highest public debts in Europe, but has kept its primary balance, the budget before interest, close to or above zero for most of the past three decades.

Currency: Euro · Central bank: European Central Bank · Economy: about $2.7tn

1 · Government finances

How much it owes, and what it costs

Government debt in Italy is about 138% of GDP this year, on IMF estimates, 4 points higher than in 2019. The government is running a deficit of 2.9% of GDP, and all of it is interest: before interest, the budget is in surplus. The IMF expects debt to fall to about 136% by 2031.

Measure	2019	2025	2026IMF estimate	2031IMF forecast
Government debt% of GDP, gross	133.9%	137.1%	137.9%	135.6%
Budget balance% of GDP, minus = deficit	−1.5%	−3.1%	−2.9%	−2.7%
Primary balancebudget before interest	+1.7%	+0.5%	+1.0%	+1.9%
Interest cost% of GDP, net	3.2%	3.6%	3.9%	4.6%

Credit ratings

BBB+S&P

Baa2Moody’s

BBB+Fitch

Long-term foreign-currency ratings, checked 25 October 2026. AAA is the highest grade; below BBB− is “high yield”.

2 · External position

What it earns and spends abroad

Italy runs a current account surplus of 0.7% of GDP (about $18bn): it earns more from the rest of the world than it spends there, and lends the difference abroad.

Measure	2019	2025	2026IMF estimate	2007–26
Current account% of GDP	+3.2%	+1.1%	+0.7%
Current accountUS$ billions	+64	+28	+18

3 · Economy and markets

Growth, prices and borrowing costs

The IMF expects the economy to grow 0.8% this year in real terms, with inflation averaging 3.3%. Its 10-year borrowing cost, 3.99%, is below the economy’s nominal growth of roughly 4.1% (growth plus inflation). Over time, that helps keep debt stable relative to GDP.

2.50%Policy rate · ECB deposit rate
24 Oct 2026

3.99%10-year yield · 10-year BTP
Aug 2026

3.8%Inflation, latest month · Euro area figure
Sep 2026

Measure	2025	2026IMF estimate	2027IMF forecast
Growthreal GDP, %	0.5%	0.8%	0.6%
Inflationaverage for the year, %	1.6%	3.3%	2.8%
Unemployment% of workforce	6.1%	5.6%	5.8%

Also relevant

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24 Oct 2026Investors rush into government bonds after an AI-led tech sell-offThe US 10-year yield had its biggest one-day fall in over two years on 22 October. German, French and UK yields also dropped.United States · Europe · Euro area · United Kingdom · Link 4 · Yields · In the chain

Mechanics

The mechanics behind it

Mechanic 05How government debt grows or shrinks Mechanic 02Why some governments pay more to borrow Mechanic 01How inflation, interest rates and bond yields fit together

Concepts

Terms on this page

Debt-to-GDP ratio Budget deficit Primary balance Credit rating Current account Government bond

More countries

Other country profiles

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Sources and notes

Government finances, current account, growth, inflation and unemployment: IMF World Economic Outlook and Fiscal Monitor, via the IMF DataMapper (checked 2026-10-24). The IMF publishes them in April and October.
2026 figures are IMF estimates, and later years are IMF forecasts. Earlier years are actual data, sometimes revised.
Debt is general government gross debt: central, regional and local government and social security. Interest cost is net interest, worked out as the primary balance minus the overall balance.
Credit ratings: long-term foreign-currency ratings from S&P Global, Moody’s and Fitch, checked on the date shown. Agencies can change them at any time.
Policy rates, 10-year yields, monthly inflation and exchange rates: as on The numbers page.