Italian Firm Inflation Expectations and Public Information Impact

Banca d'Italia published a working paper (N. 1532, April 2026) by Filippo Natoli and Sharath Sonti examining how Italian firms form inflation expectations. The study used a randomized experimental design, providing a random subset of surveyed firms with updated current inflation data. The results show that informed firms produced more accurate inflation forecasts and adjusted their predictions more coherently with macroeconomic conditions than firms without access to the latest data. The paper identifies overconfidence as the primary behavioral mechanism: firms tend to rely excessively on their own views, but this cognitive bias is attenuated when public-sector economic data is provided.\n\nFor central banks and statistical agencies, the findings suggest that proactively disseminating timely macroeconomic data to the business community could improve private-sector forecasting accuracy and, by extension, the quality of economic decision-making. For firms and financial advisers operating in Italy, the study highlights the practical value of incorporating the most recent official inflation releases into internal forecasting processes to counteract self-generated estimation errors.