European monetary and fiscal support, a large, wealthy and diversified economy, and favourable debt profile support the rating. High public debt, low productivity, labour market rigidities, weak demographics, and political uncertainty are challenges.

European institutional support and a credible reform programme drive the Outlook change. High government debt and structural economic bottlenecks are ratings challenges.

Deteriorating public finances and weakness in Italy’s medium-run growth prospects drive the Outlook change. European institutional support, including from the ECB, the economy’s systemic importance and a strong external sector support the ratings.

Lack of a coherent reform agenda to address structural weaknesses and debt sustainability concerns drive the downgrade. Moderation of policy objectives, record of primary surpluses, and access to European backstops support the Stable Outlook.