Abstract
The article briefly summarises the Bank of Italy’s survey of the development in 1952 of national income and investment, prices, wages and the profit level, the volume of bank credit, the balance of payments and the budget deficit. It goes on to analyse in greater detail the year’s monetary and credit developments, and to discuss the factors which led to the heavy increase in the volume of deposits and of bank lending. It refers particularly to the reduction in interest rates, the addition to the cash base provided by the Central Bank, and the decrease in the ratio of cash to deposits held by the public, the diminution of their liquidity ratios by the banks, and the explanation given by the Bank of Italy of the large increase which took place in bank lending in comparison with the relatively small expansion in national income and investment recorded by the official statistics.
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