Italian Economy May be Bottoming Out

Recent data updates for Italy show that the recession is easing. Although in the second quarter of 2013, the GDP shrank 0.2 percent, it was the lowest drop in more than two years. While consumer confidence have been increasing in spite of high unemployment rate and austerity measures, the rise in Manufacturing Confidence Index points to an improvement in business conditions in the months ahead.

Italian economy  remains in the longest post war recession. In Q2, the GDP contracted less than expected: 2 percent year-on-year and 0.2 percent quarter-on-quarter.

In July, consumer confidence rose to 98.7, its highest level since March of 2012. Retail sales have been falling since April of 2012 and in May it declined 1.1 percent yoy.

The Manufacturing Confidence Index hit a 19-month high in July and has been on an upward trend since April. Industrial production has also been improving and in June it grew the most since December of 2011.

In June, the jobless rate declined to 12.1 percent from its record high of 12.2 in May. Both youth and total unemployment have dropped but still remain near its highest levels since the data series began in 1977.

Nuno Fontes |
8/6/2013 11:56:13 AM