Italy’s Industrial Output Unexpectedly Decline in February

The industrial output of Italy suddenly weakened in February which further showed signs that growth in the Euro area may exceed its peak. The production declined by 0.5 percent since January after it dropped to 1.8 percent, according to the Istat in Rome yesterday. While economists predicted an expansion of 0.8 percent in February based on the median of 24 forecasts in the poll by Bloomberg. In the previous year, the working-day adjustment industrial output increase by 2.5 percent.

The manufacturing of consumer goods fell to 2.4 percent in February which had a major contribution to the monthly tightening. The manufacturing index of the country showed a lower than expected results in March after the failure in general elections to have a clear winner. This triggered concerns for the possible lengthy process prior to forming a new government.

Italy is the third largest economy in the European region and grew in 2017 at its fastest pace from 2010 since weaker consumption was outweighed due to increasing investments and exports. However, the national output hovered below its pre-crisis level where most of the major EU economies were able to recover from its sluggishness.

The German industrial production softens in February because construction shrank as well as the investment goods. The major downturn was 1.6 percent recorded in August 2015. While the research firm Sentix had a pessimistic outlook towards the Italian economy as indicated in their monthly report since July 2016.

-Kathreena