Italy's economic growth remains weak in first quarter
Staff Writer |
Italy's economy posted modest growth in line with expectations in the first quarter and continued to underperform most of its euro zone partners, data showed on Tuesday.
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Gross domestic product (GDP) rose 0.2 percent from the previous three months, national statistics institute ISTAT reported, the same moderate rate as in the last quarter of 2016.
On a year-on-year basis, GDP was up just 0.8 percent, slowing from a 1.0 percent rise in the fourth quarter of last year.
The data shows the euro zone's third largest economy, after a long recession that ended in 2014, is still struggling to build up sufficient growth momentum to significantly improve living standards or cut unemployment.
So-called "hard" data, such as industrial output and GDP, have so far failed to reflect extremely buoyant surveys of sentiment and activity levels among purchasing managers in both the manufacturing and services sectors.
Both the quarterly and annual rates of GDP growth in the first quarter were in line with the average forecasts in a Reuters survey of 24 analysts.
ISTAT said growth was supported by domestic demand in the first quarter, while trade flows were a drag on activity.
It gave no numerical breakdown of components with its preliminary estimate, but said industry had contracted, while services and agriculture were positive.
Over the whole of last year, Italy's economy grew 0.9 percent, around half the average rate of the 19-nation euro zone, following growth of 0.8 percent in 2015.
Its underperformance compared to its peers continued in the first quarter, when the euro zone as a whole grew by 0.5 percent, according to preliminary aggregate data released on May 3.
For 2017 Prime Minister Paolo Gentiloni's government forecasts Italian growth of 1.1 percent, slightly above the projections of most independent bodies.
So called "acquired growth" at the end of the first quarter stood at 0.6 percent.
This means that even if GDP were to be flat quarter-on-quarter throughout the rest of this year, over the whole of 2017 it would still be up 0.6 percent from 2016. ■