Skyline of Florence, Italy

Italy GDP Q4 2024

Italy: Economy flatlines again in Q4

Economy remains muted in Q4, surprising markets on the downside: According to a preliminary estimate, economic activity was flat in seasonally adjusted quarter-on-quarter terms in Q4, stagnating for the second consecutive quarter. The reading came in below market expectations. On an annual basis, economic growth remained at Q3’s 0.5% in Q4. Over 2024 as a whole, GDP growth fell to 0.5% year on year (2023: +0.8% yoy).

Stronger net exports offset subdued domestic demand: On the expenditure side, Q4’s flat reading was due to a stronger contribution from net exports offsetting more subdued domestic demand. On the production side, declines in the agriculture, forestry and fishing sector plus the services sector offset an improvement in the industrial sector.

A complete breakdown will be released on 5 March.

Rate cuts and stronger EU demand will fuel growth: Our panelists expect GDP growth to pick up from current levels in Q1 2025. The ECB’s monetary policy easing cycle will buttress private spending growth—roughly one-third of households’ mortgages have variable rates—and stronger EU demand should boost exports.

Accordingly, in 2025 as a whole, economic growth will accelerate compared to 2024 as exports, private consumption and public spending pick up. That said, the economy poised to grow less than the Euro area average due to subdued fixed investment. Rising U.S. protectionism and a weaker-than-expected recovery in the German manufacturing sector are downside risks.

Panelist insight: Commenting on the 2025 economic outlook, ING’s Paolo Pizzoli stated:

“2025 will likely start on a soft-ish foot, with multiple external factors keeping uncertainty elevated. In Europe, the sources of uncertainty will be France and Germany, the top two destinations for Italian exports. Political instability, tighter fiscal policy in France and a lack of policy direction in Germany before the February elections will likely continue to weigh on Italian exports.”

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 X Download Fullscreen