Skyline of Florence, Italy

Italy GDP Q4 2022

Italy: Economy dips but beats expectations in the fourth quarter

According to a preliminary estimate, GDP declined 0.1% in Q4 in quarter-on-quarter seasonally adjusted terms, down from the 0.5% expansion recorded in the third quarter but beating market expectations.

Looking at the breakdown of the quarter-on-quarter growth figure by expenditure, the statistical office said that domestic demand made a negative contribution to the final reading while net exports had a positive effect. In sectorial terms, the primary and secondary sectors contracted while the services sector expanded.

On an annual basis, economic growth waned to 1.7% in the fourth quarter, following the previous period’s 2.7% expansion.

A more detailed breakdown will be available on 3 March.

Moving into this year, the economy will likely contract slightly in Q1. The cost-of-living crisis will put some strain on consumer spending, while higher interest rates should constrain investment. That said, the yield spread between German and Italian 10-year bonds—a proxy for Italy’s fiscal credit risk—has declined from around 220 points in late 2022 to 180 points in January, potentially reflecting a calming market. Looking ahead, the economy should record negligible growth this year due to depleted savings, higher interest rates, still-high inflation and global headwinds. Pro-market reforms pose upside risks, while elevated public debt poses a downside risk to the outlook.

Free sample report

Access essential information in the shortest time possible. FocusEconomics provide hundreds of consensus forecast reports from the most reputable economic research authorities in the world.
Close Left Media Arrows Left Media Circles Right Media Arrows Right Media Circles Arrow Quote Wave Address Email Telephone Man in front of screen with line chart Document with bar chart and magnifying glass Application window with bar chart Target with arrow Line Chart Stopwatch Globe with arrows Document with bar chart in front of screen Bar chart with magnifying glass and dollar sign Lightbulb Document with bookmark Laptop with download icon Calendar Icon Nav Menu Arrow Arrow Right Long Icon Arrow Right Icon Chevron Right Icon Chevron Left Icon Briefcase Icon Linkedin In Icon Full Linkedin Icon Filter Facebook Linkedin Twitter Pinterest