The eurozone‘s third largest and recession-hit Italian economy still has a long way to go to pull itself out of its current slowdown. Italian Economy fell back into recession at the end of last year, it contracted by 0.2% in the 3rd quarter from the previous 3 months and shrank 2.4% over twelve months.
The escalating brinkmanship – Troubled Italian Economy —- weak growth and lack of confidence!
The Italian government has forecast that the economy will contract by 2.4 percent in 2012 and slow by another 0.2 percent next year. Car sales in Italy declined 12 percent in October.
Italy is living “very difficult times” because of both the economic and financial crises, Bank of Italy Governor Ignazio Visco said. The way out of recession “won’t be easy nor painless,” he added.
Italian Finance Minister Vittorio Grilli said, “Italian economy begin to recover from a painful recession in the second half of 2013 but warned that the country was not yet in the clear”
“Even if the emergency phase was over, which it isn’t, the markets wouldn’t stop being on edge without the certainty that whoever is to govern in the future will continue on the path of rigour.”
According to Istat.it: In November, the confidence climate index decreased from 86.2 to 84.8. The decrease was notably explained by economic and future climate, that fell from 71.5 to 69.4 and from 78.2 to 75.2. The balance concerning expectations on unemployment increased from 108 to114. Finally, the balance on inflation perceptions referring to the last 12 months decreased from 74 to 69 compared to the previous month. The balance on inflation expectations for next 12 months also decreased from 30 to 28.
- More than 35 per cent of young Italians are out of work.
- unemployment jumped to its highest since 1999, reaching 10.8 per cent in September, up from 10.6 per cent in August.
- The government pledged €2.1 billion in tax incentives to persuade unions and business groups to seal the pact.
- Italy’s elections are coming in April 2013, and the outcome is going to be crucial.
What do you think are reasons for Troubled Italian Economy – slow economic growth?