MILAN – Alerts on the trend of the Italian economy intensify in the final part of the year, with companies squeezed between unsustainable energy bills and fears that consumers will tighten their belts and give up on purchases to make ends meet.
Yesterday, at the press conference on the new Aid decree, both Prime Minister Draghi and Minister Franco spoke of an Italian slowdown but remarked that there are no clear symptoms of a real recession, the one that instead sees Fitch and fears Confcommercio. Today is Confindustria Study Center to complain that “the scenario is turning downward” and summarizes in the title of its flash economy: “Record gas price, inflation and higher rates: difficult context in the second half of 2022”.
The forecasts: energy and political uncertainty, so Italy risks recession
by Vittoria Puledda
September 16, 2022
Many times the CSC has already raised alarms on the dynamics of industrial production, which until the summer then held up better than expectations and other European competitors such as Germany. But now this super resilience is put to the test by the long months it has been under stress. “The rise in gas prices since August has gotten out of control, in the wake of cuts in supplies from Russia. The resilience of the industry is on the ropes, after too many months of the impact of expensive energy on company margins: investments will suffer. Record inflation erodes household income and threatens consumption, protected (in part and not for long) by accumulated savings. The ECB has responded to high prices and a weak euro by raising rates, which will give a further recessionary impulse. Prices fall back. of various commodities, because the world economy is weaker. Italy is resisting thanks to: more mobility and tourism; (lower) growth in construction. Employment holds up, so far “, is the diagnosis of the CSC..
In industry detail, Viale dell’Astronomia sees that “the fall materializes. The qualitative indicators have worsened: in August, the PMI fell even further into negative territory (48.0), signaling a recession; also the opinions on orders Istat are in decline, anticipating lower demand; business confidence has undergone a further decline, at reduced levels. Industrial production showed a recovery in July (+ 0.4%), confirming the resilience of Italian companies, with a dynamic better than the German and French ones; but it is still expected to decline in the 3rd quarter (-1.4% acquired). In construction, the signs of deceleration continue, after the long phase of expansion: the trend in the construction sites already started is seen in sharp decline in the 3rd quarter “.CopyAMP code
If exports are resilient and services are recovering thanks to the recovery of tourism, the Eurozone as a whole is seen in a sharp slowdown.
In the focus of the month, the CSC conducted two econometric simulations for the price of gas: one that remains until the end of 2023 at 235 euros / mwh (the average value for August); the second at 298 euro / mwh (the average level expected from futures). The impact for the Italian economy (compared to a baseline in which the price of gas is held at the average of the first 6 months of 2022: 99 euros) is estimated in a lower GDP growth of 2.2% and 3 , 2% cumulative in the two-year period 2022-2023, in the two scenarios, and in 383 thousand and 582 thousand less employed. “The abnormal increase in the price of gas and the risks of shortages on volumes – it is emphasized – have a heavy impact on Italy and other European countries, gas importers. By holding back the other economies, this penalizes Italy even more, through a minor export “.