Overview of Italy’s Real GDP
In 2021, the real GDP of Italy reached $2.1 trillion, an increase of 6.6% over the previous year. Italy's real GDP declined at a CAGR of -0.2% between 2010 and 2021. However, the outlook for Italy's economy was clouded due to a spike in COVID-19 cases and rising oil prices amid the war between Russia and Ukraine.
Outlook on Global Economy
Real GDP refers to base year prices, which include inflation. Changes in real GDP indicate the increase or decrease in the volume of economic activity and measure economic growth.
The US, China, Japan, Germany, and India are the world's top five economies in terms of real GDP. The US real GDP topped with $18.6 trillion in 2021, followed by China with a value of $12.7 trillion. The real GDP of Japan reached $6 trillion during the same period, putting it third globally. Germany and India, with real GDPs of $3.8 trillion and $2.9 trillion, are the other two largest economies.
Factors Affecting the Global Economy
A rise in COVID-19 cases:
As a result of Omicron, a new variant of COVID-19, more cases have been reported worldwide, resulting in the disruption of supply chain management. However, the global vaccination drive has reduced the fatality from COVID-19.
Russia-Ukraine war:
A prolonged conflict between Russia and Ukraine will continue to affect global economic growth. Investment and trade have been adversely affected due to the war as economic sanctions have been imposed on Russia, and several big companies have stopped their operations in the country.
Rising Inflation and Interest Rates:
As a result of rising inflation rates in both developing and advanced economies, central banks have been forced to tighten monetary policy and raise interest rates to keep prices from rising. However, a steady increase in interest rates could cause financial distress in some economies.
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