Italy industrial output dives unexpectedly in August

Italy’s Industrial Output Drops Unexpectedly by 1.3% in August 2023

Analysis of Italy’s Latest Industrial Output Figures

Unexpected Decline in August 2023

ROME, Oct 9 (Reuters) - Italian industrial output unexpectedly fell 1.3% in August from the previous month after a 0.6% rise in July, national statistics bureau ISTAT reported on Friday, a far weaker reading than expected that clouds the outlook for the euro zone's third-largest economy.

Analyst Expectations vs. Actual Results

• A Reuters survey of 11 analysts had pointed to a flat month-on-month reading in August.

Three-Month Rolling Average and Revisions

• ISTAT's rolling three-month average showed that in the June-August period industrial output was down 1.1% compared with March-May.

• July's data was revised down marginally from an originally reported 0.7%.

Year-on-Year Output and Seasonal Volatility

• On a work day-adjusted year-on-year basis, output was flat in August following a 0.1% decrease in July.

• Italian industrial output data is often volatile in August, when many factories are closed.

Broader Economic Context

Economic Performance in 2023

• The Italian economy held up better than many analysts expected in the first half of this year, with gross domestic product rising by 0.3% in the first quarter and 0.2% in the second.

Government Forecasts and Recovery Funds

• Giorgia Meloni's government last week said gross domestic product would rise by 1% in 2026, hiking a previous estimate of 0.6% made in April.

Recent Growth Trends

• In 2025 the economy grew by 0.5%. It hasn't exceeded 1% in the last three years despite the steady influx of tens of billions of euros of COVID-19 recovery funds from the European Union.

(Reporting by Antonella Cinelli, graphic by Stefano Bernabei, editing by Gavin Jones)