According to the economic minister of Italy, the rate hikes by the central bank of Europe are highly worrying for the country. If we look at the reason behind this comment, the biggest one would be that Italy is highly indebted.
So an increase in the interest rates means that the country will have to pay more money on any new debts. This would seriously affect Italy's ability to raise more money for its finances.
Giancarlo Giorgetti, who is the economic minister of Italy, said that his country had enjoyed low-interest rates (close to zero) for several years now. But now that the ECB has turned hawkish, that will no longer be the case.
Just a few days ago, ECB raised the interest rates once again... This time, the increase was 50 basis points and was in line with the market's expectations. However, the central bank made it clear that it will not be stopping its rate hike cycle anytime soon.
In fact, ECB made it clear that there will be a lot more rate hikes in the next few months. This scenario is the worst for the debt-ridden countries of Europe, especially Italy.
And it seems that Italy's finance minister is not the only voice against this policy of the ECB. The country's deputy prime minister 'Matteo Salvini' branded this move of the ECB as baffling and worrying. Similarly, the defence minister even went as far as to say that it would help Russia and will weaken western solidarity.
For the 2023 budget, Italy is planning to set aside 21 billion euros to help families and businesses with their gas and electricity bills. But considering the current policy of the ECB, it would make things more difficult for Italy.
Giancarlo Giorgetti also said that the IRA scheme of the USA is posing threats to the country's economy. In fact, many Italian companies have started thinking about moving their production to the United States of America.