ROME — Italy’s economy shrank by 0.1% in the fourth quarter of last year from the previous three months, preliminary data showed on Tuesday, a slightly smaller contraction than expected but still raising fears of recession.
On a year-on-year basis, fourth quarter gross domestic product in the euro zone’s third largest economy was up 1.7%, national statistics bureau ISTAT said.
A Reuters survey of 23 analysts had forecast a 0.2% quarterly decline and a 1.6% rise compared with the year earlier.
While Italian output slipped slightly at the end of 2022, GDP across the whole euro zone expanded by 0.1% in the fourth quarter, Eurostat said, lifted by expansion in Spain and France.
Over the whole of last year, Italian GDP growth, adjusted for the number of working days, came in at 3.9%.
Looking ahead, the outlook has been clouded by sky-high inflation and energy costs, exacerbated by the war in Ukraine, which have sapped business and consumer confidence, crimped investments and hit families’ spending power.
Italian bank Unicredit, which had forecast Italian GDP to contract by 0.1% this year, said after Tuesday’s data that it was likely to upgrade its outlook to one of “modest growth.”
“The stock of excess savings accumulated during the COVID-19 pandemic still amounts to a sizeable 8% of nominal GDP, thus remaining a growth-supportive factor for this year,” said the bank’s chief Italian economist Loredana Federico.
Rome is officially forecasting growth of 0.6% this year, and the International Monetary Fund on Tuesday also sharply raised its own 2023 estimate to 0.6%, from a forecast of -0.2% made in October.
The Treasury estimated in November that the economy would contract in the fourth quarter of last year and the first quarter of 2023, dumping the country in recession – defined as two consecutive quarters of falling GDP.
ISTAT said the fourth quarter saw a fall in domestic demand, which negatively outweighed a positive contribution from trade flows.
It gave no numerical breakdown of components with its preliminary estimate, but said industry and agriculture had declined during the quarter, while services grew.
ISTAT confirmed a 0.5% quarter-on-quarter growth rate for the third quarter but revised up the Q3 annual expansion to 2.7% from a previously reported 2.6%.
It said so-called “acquired growth” going into 2023 stood at 0.4%, meaning that even if GDP is flat in each of the four quarters of this year, full-year growth will be up 0.4% from the year earlier. (Additional reporting by Stefano Bernabei; Editing by Crispian Balmer)
OTTAWA – The parliamentary budget officer says the federal government likely failed to keep its deficit below its promised $40 billion cap in the last fiscal year.
However the PBO also projects in its latest economic and fiscal outlook today that weak economic growth this year will begin to rebound in 2025.
The budget watchdog estimates in its report that the federal government posted a $46.8 billion deficit for the 2023-24 fiscal year.
Finance Minister Chrystia Freeland pledged a year ago to keep the deficit capped at $40 billion and in her spring budget said the deficit for 2023-24 stayed in line with that promise.
The final tally of the last year’s deficit will be confirmed when the government publishes its annual public accounts report this fall.
The PBO says economic growth will remain tepid this year but will rebound in 2025 as the Bank of Canada’s interest rate cuts stimulate spending and business investment.
This report by The Canadian Press was first published Oct. 17, 2024.
OTTAWA – Statistics Canada says the level of food insecurity increased in 2022 as inflation hit peak levels.
In a report using data from the Canadian community health survey, the agency says 15.6 per cent of households experienced some level of food insecurity in 2022 after being relatively stable from 2017 to 2021.
The reading was up from 9.6 per cent in 2017 and 11.6 per cent in 2018.
Statistics Canada says the prevalence of household food insecurity was slightly lower and stable during the pandemic years as it fell to 8.5 per cent in the fall of 2020 and 9.1 per cent in 2021.
In addition to an increase in the prevalence of food insecurity in 2022, the agency says there was an increase in the severity as more households reported moderate or severe food insecurity.
It also noted an increase in the number of Canadians living in moderately or severely food insecure households was also seen in the Canadian income survey data collected in the first half of 2023.
This report by The Canadian Press was first published Oct 16, 2024.
OTTAWA – Statistics Canada says manufacturing sales in August fell to their lowest level since January 2022 as sales in the primary metal and petroleum and coal product subsectors fell.
The agency says manufacturing sales fell 1.3 per cent to $69.4 billion in August, after rising 1.1 per cent in July.
The drop came as sales in the primary metal subsector dropped 6.4 per cent to $5.3 billion in August, on lower prices and lower volumes.
Sales in the petroleum and coal product subsector fell 3.7 per cent to $7.8 billion in August on lower prices.
Meanwhile, sales of aerospace products and parts rose 7.3 per cent to $2.7 billion in August and wood product sales increased 3.8 per cent to $3.1 billion.
Overall manufacturing sales in constant dollars fell 0.8 per cent in August.
This report by The Canadian Press was first published Oct. 16, 2024.
