GDP Italy first quarter -5.3%, year-on -5.4%. Exceptional drop, worse since ’95 – Economy

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In the first quarter of 2020, Italy’s GDP decreased by 5.3% compared to the previous quarter and by 5.4% compared to the first quarter of 2019. Istat notes this, revising downwards the preliminary estimates released at the end April, which gave Gross Domestic Product a 4.7% drop on a cyclical basis of 4.8% in the annual comparison. The data are correct for calendar effects and seasonally adjusted.

The acquired change in GDP for 2020 is -5.5%. Thus Istat giving an account of the result that would be obtained in the event that in all the remaining quarters of the year there was zero economic growth.

In the first quarter of 2020, compared to the previous one, “all the main aggregates of domestic demand are decreasing, with a 5.1% drop in national final consumption and 8.1% in gross fixed investment”, noted the Istat by spreading the quarterly economic accounts.

In the first quarter of 2020 “there were negative economic trends in value added in all the main production sectors, with agriculture, industry and services falling by 1.9%, 8.1% and 4.4% respectively”. It was therefore the industry that took the biggest hit.

Imports and exports in the first quarter of 2020 fell cyclically by 6.2% and 8% respectively.

“The drop in GDP was mainly driven by domestic demand”, while “foreign demand, also falling, provided a less marked negative contribution”. “Internally, the contribution of private consumption – he explains – was strongly negative for 4 points and that of investments for 1.5, while a large positive contribution (+1 percentage point) came from changes in inventories”.

The national consumer price index for the whole community (NIC) in May 2020 gross of tobaccos recorded a decrease of 0.1% both on a monthly and an annual basis. Istat notes this on the basis of preliminary estimates, recalling that the trend variation was zero in the previous month. The downward trend in the general consumer price index is mainly attributable to the dynamics of the prices of non-regulated energy goods, which accentuate their drop (from -7.6% to -12.2%). “Basic inflation”, net of energy and fresh food, recorded an increase (price index from + 0.8% to + 0.9%) while the price index net of energy goods only went from + 1% to + 1.1%. Inflation acquired for 2020 is zero for the general index and + 0.7% for the underlying component.

The prices of food goods, for home and personal care slightly accelerated growth in May from + 2.5% to + 2.6% trend (+ 0.7% on April) while those of high frequency products d The purchase recorded a tendential change of zero (from + 0.8% in April).

Spending carried out by households in Italy, on the territory, decreased by 7.5% in economic terms, emerges from Istat data on the first quarter. A collapse that is particularly affected by the drop in purchases for durable goods (-17.5%), from cars to furniture. The decrease was also strong for semi-durable goods, which include clothing, (-11.4%). The figure for services also fell (-9.2%). The decrease for non-durable goods, classification where food is included, is much more contained (-0.9%).



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