Consumption in Italy
Italy - Consumption
Economy shrinks at unprecedented pace in Q1 2020
In the first quarter of the year, Italy’s GDP tumbled 4.7% over the previous period in seasonally- and working-day adjusted terms, according to an advance estimate released by Italy’s Statistics Institute (ISTAT) on 30 April. GDP dived at an unprecedented pace due to the economic effects of the current health emergency and the associated containment measures adopted by the government. The result marked the second consecutive quarterly contraction (Q4 2019: -0.3% quarter-on-quarter) following one year of stagnation, as well as the sharpest drop since the current historical series began in 1995. Meanwhile, in annual terms, the economy contracted 4.8% in Q1, contrasting a 0.1% uptick in Q4 and also marking the sharpest fall on record.
According to the accompanying press release, Q1’s reading reflected falling production in all sectors—primary, industry and services—although the secondary and tertiary sectors were the hardest hit. On the demand side, preliminary data indicated that both domestic and external demand made negative contributions to growth. More detailed national accounts data will be released on 29 May.
Commenting on the outlook, Loredana Federico, chief Italian economist at UniCredit, stated:
“A gradual easing of restrictions will start in Italy on 4 May and will mainly involve the industrial sector. While this turn of events will likely support a recovery in economic activity, we think that the need to continue the practice of social distancing will probably prevent a return to normal economic activity, and therefore that exceptionally high levels of uncertainty are likely to continue.”
The pandemic will continue to wreak havoc on Italy’s already-ailing economy, hitting domestic and external demand and disrupting supply chains. The health crisis will also lead to a widening of the fiscal deficit and further accumulation of the mountainous stock of public debt, while also deteriorating banks’ balance sheets. Lingering political instability and episodes of financial turmoil pose further downside risks. Long-standing problems such as a cumbersome public sector, much-needed market-friendly reforms, high taxes and a sluggish judiciary further cloud Italy’s outlook.
FocusEconomics panelists are still taking the latest developments into account.
Italy - Consumption Data
|Consumption (annual variation in %)||0.2||1.9||1.2||1.5||0.8|
5 years of economic forecasts for more than 30 economic indicators.
|Bond Yield||1.31||-0.40 %||Jan 01|
|Exchange Rate||1.12||0.65 %||Dec 31|
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May 28, 2020
The National Institute of Statistics (Istat)’s composite business confidence indicator (Clima di Fiducia delle Imprese Italiane, IESE)—which covers the manufacturing, construction, market services and retail sectors—collapsed to an all-time low of 51.1 in May from March’s 99.2 (the latest preceding month for which data is available). May’s crash came on the back of a broad-based sharp worsening of sentiment across sectors.
May 28, 2020
The consumer confidence index released by the National Institute of Statistics (ISTAT) fell to 94.3 in May from March’s 100.1 (the last preceding month for which data is available), marking the worst print since December 2013. May’s decline came on the back of a broad-based deterioration in the economic, personal, current and future components.
May 15, 2020
Consumer prices rose 0.1% from the previous month in April, matching the 0.1% rise logged in March.
May 11, 2020
Industrial output collapsed 28.4% in March on a month-on-month, seasonally-adjusted basis.
May 4, 2020
The IHS Markit manufacturing Purchasing Managers’ Index (PMI) crashed to 31.1 in April from 40.3 in March, amid widespread Covid-19 shutdowns.