Prices in Italy would be even higher than they are at the moment if Italy had not dropped the lira and adopted the euro, Premier Mario Monti said on Thursday.
Many Italians blame the introduction of the euro for sharp increases in the prices of many items since its launch in 2002 and skepticism about the benefits of the single currency has increased recently with the eurozone debt crisis and the recession.
But former European commissioner Monti believes things would be even worse if Italy had stuck with the lira.
"If we had not passed over to the euro, the prices of goods and services in Italy would be much higher than they are," the premier said at a conference in the capital at the Roma Tre university.
Tax increases introduced by Monti's emergency government have helped push up prices, but he said they were necessary.
"To avoid financial collapse, Italy has adopted measures that are leading to high prices for the public and companies," said Monti.
Monti also maintained he was confident the economic reforms and the policies to restore health to Italy's public finances that his emergency government has introduced will continue after his term ends next year.
The premier, who is not aligned with a political party and has repeatedly said he will not stand at elections next spring, said he was "very serene" about the future of the 'Monti agenda' after he steps down as premier.
"I'll be pleased if the things we believed in have a full development with the corrections that are deemed necessary," he added.
Monti said that his emergency government had worked to avoid the "asymmetric" loss of sovereignty that would have come if Italy had needed to ask for an international bailout like the ones granted to Greece, Ireland and Portugal.
"I tried to stop Italy needing a type of aid and programme that would entail a further, major, asymmetric cession of sovereignty," Monti said. Speaking about the country's high unemployment, Monti said that the 1970 Workers' Statute protecting employees' rights has hampered job creation in Italy. Earlier this year Monti's government approved a labour-reform package that featured changes to the statute to make it easier for firms to fire workers, although the measures were watered down after staunch opposition from unions and the centre-left Democratic Party. "Certain regulations in the Workers Statute that were inspired by the noble intention to defend workers have led to an insufficient creation of new jobs," Monti said. Monti has repeatedly argued that increasing companies' power to dismiss staff makes them more inclined to hire workers and boosts productivity too.