FX.co ★ Fitch raises Italy’s rating, but no major acceleration in sight

International rating agency Fitch has nudged up Italy’s credit rating—from ‘BBB’ to ‘BBB+’—and assigned it a stable outlook. Italy's short-term rating has also improved, and the country ceiling has been raised from ‘AA’ to ‘AA+’. It appears that Italy has finally managed to fit into the framework of European fiscal discipline—at least on paper.

Fitch links this success to growing budgetary prudence and a firm commitment to the complex but largely understandable goals of the EU. Politics has become more stable, reforms are progressing, and external balances are a bit less shaky. In short, Italy promises to keep its books in order and stay in line.

According to Fitch, however, Italy’s economy is projected to grow by only 0.6% in 2025 and barely pick up speed, reaching 0.8% in 2026–27. By comparison, the average growth rate for countries rated ‘BBB’ is about 2.5%. In other words, Italy is running a marathon at the cautious pace of a pensioner, not in a sprint.

Domestic demand is expected to play the lead role, compensating for a rather unimpressive external sector. On the bright side, the labor market is performing well—unemployment is lower than the eurozone average, confirming that Italians still know how to work or perhaps have just gotten better at paperwork.

Prime Minister Giorgia Meloni declared that the ratings upgrade is a clear signal of confidence and proof that the government’s policies are on the right track. Let’s hope this is more than just a political diploma for the government and marks the start of a new chapter in the country's development.

Should these improvements continue, Italy could add ratings agency upgrades to its list of national achievements alongside pasta and opera.