Italy: GDP contracts in Q3
September 9, 2011
In the third quarter GDP contracted a seasonally and working-day adjusted 0.2% quarter-on-quarter, down from market expectations of a 0.1% drop. The reading contrasted the 0.3% expansion recorded in Q2 and marking the first contraction in the last seven quarters and the largest decrease since the first quarter of 2009. On an annual basis, the economy expanded 0.2%, below the 0.7% rise recorded in the previous quarter and market expectations of a 0.5% rise. In addition, the reading marked the slowest expansion since Q4 2009. The quarterly contraction was driven by the deterioration of domestic demand, which an improving contribution from the external sector was not able to compensate. Private consumption contracted 0.2%, contrasting 0.1% rise recorded in Q2, while fixed investment dropped an even larger 0.8%, down from the 0.1% increase recorded in the previous three-month period. Meanwhile, exports of goods and services rose 1.6%, up from the 1.0% rise recorded in the previous quarter, while imports contracted 1.1%, virtually in line with the 1.2% drop in Q2. As a result, the external sector's net contribution to overall growth rose from plus 0.6 percentage points in Q2 to plus 0.8 percentage points in Q3.
Author: Armando Ciccarelli, Head of Data Solutions