Published by Global Banking & Finance Review®
Posted on February 12, 2025
2 min readLast updated: January 26, 2026
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Italy's industrial output fell 3.1% in December, marking the largest drop in two years, as economic challenges continue. GDP stagnation and geopolitical tensions cloud recovery prospects.
ROME (Reuters) - Italian industrial output was much weaker than expected in December, falling 3.1% from the month before and pointing to deepening problems for the country's stagnant economy, data showed on Wednesday.
December marked by far the biggest monthly fall in output for at least two years, national statistics bureau ISTAT said, and the data was below all forecasts in a Reuters survey of 16 analysts which pointed to a marginal 0.2% decline.
Gross domestic product in the euro zone's third-largest economy stagnated for a second straight quarter at the end of 2024, ISTAT reported last month.
Analysts expect no significant recovery in the near term, with the outlook clouded by geopolitical tensions, the prospect of U.S. trade tariffs and the difficulties faced by Rome in deploying its EU pandemic recovery funds.
On a work-day adjusted year-on-year basis, industrial production was down in December by 7.1%, ISTAT said. That marked easily the steepest of 23 consecutive annual declines, and followed a 1.6% drop in November.
December's numbers close out another weak year for Italian industry, with work-day adjusted output down 3.5% over the 12-month period, following a 2.0% decrease in 2023.
Over the whole of 2024, the economy grew by 0.5% from the year earlier, when adjusted for the number of working days, ISTAT's flash estimate showed on January 30.
The statistics bureau will release non-workday-adjusted 2024 growth data on March 3.
That may be stronger than the flash estimate, reflecting four more working days in 2024 than the year earlier, but it is still expected to come in well below the government's 1% forecast.
This year most economists forecast growth of around 0.7%, again significantly weaker than Rome's official 1.2% target.
(Reporting by Antonella Cinelli, graphic by Stefano Bernabei, editing by Gavin Jones)
The main topic is Italy's worsening economic situation, highlighted by a significant drop in industrial output in December.
The drop is attributed to ongoing economic stagnation, geopolitical tensions, and challenges in deploying EU recovery funds.
Economists forecast modest growth around 0.7%, below the government's 1.2% target, with no significant recovery expected soon.
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