Italy: Decline in industrial activity softens in February
Industrial output fell 0.2% in month-on-month seasonally-adjusted terms in February, which was a less pronounced contraction than January’s 0.5% decrease. The smaller contraction came on the back of stronger electricity, gas, steam and air conditioning output. In contrast, manufacturing production lost pace.
On an annual basis, industrial output fell 2.3% in February (January: +1.6% yoy). Meanwhile, annual average industrial production growth fell to 0.2% in February (January: +0.7%), signaling a worsening trend in the industrial sector.
Commenting on the outlook, Paolo Pizzoli, senior economist at ING, stated:
“Improving supply chains and declining gas prices were not enough to bring about solid supply-side gains, possibly reflecting a combination of softish demand and decently filled stocks of finished goods. […] As order books have only timidly started to improve, we believe that the current flattish production pattern will continue for another few months, limitedly propelled by improving supply conditions. If this is confirmed, industry could fail to provide a positive push to GDP in the first quarter.”