Italy Q1 budget deficit narrows y/y to 7.8% of GDP

Italy's public budget deficit narrowed in the first quarter to 7.8% of gross domestic product (GDP), compared with 8.4% in the same period of 2025, official statistics agency ISTAT said on Wednesday.

The smaller deficit was due to a 4.0% year-on-year increase in revenues, which outstripped a 2.6% rise in public spending.

Giorgia Meloni's government is targeting the 2026 deficit at 2.9% of GDP, narrowing slightly from 3.1% last year.

ISTAT gave the following quarterly public finance data. All figures are expressed as a percentage of GDP.

Public balance Revenues Spending Primary Balance*

Q1 2026 -7.8 42.3 50.1 -4.4

Q1 2025 -8.4 41.8 50.2 -4.7

* Public balance net of debt servicing costs.