NUMBER 128 DECEMBER 217 Economic activity and employment Foreign trade and competitiveness Inflation Credit The Public Finances Macroeconomic projections 1 7 8 11 12 Directorate general for economics, statistics and research 1... -. -1. -1. Coincident indicator (Ita-coin) and Italian GDP (1) (percentage changes) Ita-coin GDP 21 211 212 21 214 21 216 217 Source: Banca d'italia. (1) Percentage change over the previous quarter. The Ita-coin indicator tracks quarterly Italian GDP growth net of the most volatile components. cfr: http://www.bancaditalia.it/statistiche/tematiche/indicatori/indicatore-ciclico-coincidente/index.html 1... -. -1. -1.
The Italian economy in brief Number 128 December 217 11 11 1 1 9 9 8 8 7 7 6 GDP and the main components of demand (1) (quarterly data; indices, 27=1) 27 28 29 21 211 212 21 214 21 216 217 GDP Exports Household consumption Gross fixed investment 11 11 1 1 9 9 8 8 7 7 6 Source: Based on Istat data. (1) Chain-linked volumes adjusted for seasonal and calendar effects. GDP, national demand, foreign trade (Chained linked volumes; percentage changes on previous period; seasonally and working-day adjusted for quarterly data) Gross domestic product Gross fixed investment Resident household and NPISH consumption (1) Government consumption Total national demand (2) Exports of goods and services Imports of goods and services 21-1.7-6.6-2. -. -2.6.7-2.4 214.1-2.. -.7.2 2.7.2 21 1. 1.9 2. -.6 1. 4.4 6.7 216.9 2.8 1.. 1.1 2.4.1 216 IV.4 2.6.2..6 1.9 2. 217 I. -2.2.7.4.2 1.8.7 II. 1.1.2.2.8.1 1.6 III.4...1.2 1.6 1.2 Source: Istat. (1) Non-profit institutions serving households. (2) Including changes in inventories and acquisitions less disposals of valuables. 2
The Italian economy in brief Number 128 December 217 Industrial production and business confidence (indices, 21=1; seasonally adjusted data) 14 1 12 11 1 9 8 7 6 4 2-2 - 4-6 - 8-1 -12 2 26 27 28 29 21 211 212 21 214 21 216 217 Industrial production, quarterly data, percentage changes on previous period (right-hand scale) Industrial production, single observations Index of confidence among industrial firms, single observations Source: Based on Istat data. Firms' assessment of the conditions for investing compared with the previous quarter (1) (quarterly data; percentage points) 2 2-2 -2-4 -4-6 -6-8 26 27 28 29 21 211 212 21 214 21 216 217-8 All firms Industrial firms Service firms (1) Balance between judgments of improvement and of deterioration compared with the previous quarter reported in the quarterly Survey on Inflation and Growth Expectations, conducted by the Bank of Italy with Il Sole 24 Ore among service and industrial firms.
The Italian economy in brief Number 128 December 217 Household confidence index and expectations for unemployment (seasonally adjusted data) 12 11 11 1 1 9 9 8 8 211 212 21 214 21 216 217 Household confidence index (1) Expectations for unemployment (2) 14 12 1 8 6 4 2-2 Source: Based on Istat data. (1) Indices, 21=1. In June 21 Istat introduced methodological innovations such that subsequent data are not directly comparable with those preceding that date. (2) Right-hand scale. The indicator is the simple average of the weighted balance between positive responses ("high", "increasing") and negative responses ("low", "decreasing") to the questions on the trend in unemployment. Persons in work and unemployment rate (seasonally adjusted monthly data; millions of persons and per cent) 2.6 2.4 2.2 2. 22.8 22.6 22.4 22.2 22. 211 212 21 214 21 216 217 14 1 12 11 1 9 8 7 6 Persons in work (left-hand scale) Unemployment rate (right-hand scale) Source: Istat, Rilevazione sulle forze di lavoro, monthly estimates, provisional 4
The Italian economy in brief Number 128 December 217 Italy's exports of goods in value (seasonally adjusted; index, 211 Q4 = 1; three-term moving averages ending in the reference month) 12 12 11 11 Total non-eu countries EU countries 12 12 11 11 1 1 1 1 9 9 9 211 212 21 214 21 216 217 9 Source: Based on Istat data. Indicators of competitiveness (1) (monthly data; indices, 1999=1) 11 11 11 11 1 1 1 1 9 9 9 9 8 '99 ' '1 '2 ' '4 ' '6 '7 '8 '9 '1 '11 '12 '1 '14 '1 '16 '17 Italy France Germany Spain 8 Sources: Based on ECB, CEPII, Eurostat, IMF, OECD and UN data and national statistics. (1) In relation to 61 competitor countries; based on producer prices of manufactured goods. An increase in an index indicates a loss of competitiveness.
The Italian economy in brief Number 128 December 217 International investment position (1) (percentages of GDP) - -1-1 -2-2 - 212 21 214 21 216 217 Flow in the quarter (financial account) Valutation adjustment in the quarter Position at the end of the previous quarter Position at the end of the quarter - - 1-1 - 2-2 - Source for GDP: ISTAT. (1) The position at the end of the quarter is equal to the position at the end of the previous quarter adjusted for the flows on the financial account during the quarter and for valuation adjustments. 8 6 4 2-2 -4-6 -8 Italy: current account of the balance of payments (12-month cumulative balance; billions of euros) Current account Goods Services Primary income Secondary income (1) 28 29 21 211 212 21 214 21 216 217 8 6 4 2-2 -4-6 -8 (1) According to the IMF Balance of Payments Manual 6th edition, secondary income consists in almost all the items previously classed as current transfers. Balance of payments (net balances; billions of euros) Current account Capital Financial account Total of which: account Net lending to the Total of which: Merchandise rest of the world Portfolio Change in Errors and investment reserve omissions A B (A+B) C assets C-(A+B) 21 1.9 6.1 -.7 1.2 21.9-4.1 1. 6.7 214 1.1 47.4 2.7.7 1. 4.1-1. 17.8 21 2.6 1.1 4. 29.6 6. 98.. 6. 216 4.6 9.8-2.6 4. 66.6 19.6-1.2 2.6 216 Jan.-Sept. 1.6 4.7-1.8 29.8 44.6 18.4-1.2 14.8 217 Jan.-Sept. 2.8 4.8-1.4 1.4 4. 9.1 2.6 8.6 216 Sept..9 4. -.4. 8. 27.9. 4.8 Oct.. 4.9 -.2 4.8 12. -4..4 7.7 Nov..8 4.8 -.2.6 -.1-17.1 -.2-6.7 Dec.. 6. -.4 4.8 12.6 42. -.2 7.7 217 Jan. -.8.2 -.1 -.9 1. -1..1 2.2 Feb. 1.7 2.8 -.1 1.6-4.1 19.2.1 -.7 Mar. 4.9 6.4 -.2 4.7 2.4 2.9.1-2.2 April.4 4. -.2..6 4.9 2..4 May 2. 4.9 -.2 2.4.8 14..2.4 June 4.8.1 -.1 4.6 7.7-7.1 -..1 July 8. 8. -.2 8.1 8.9-9.4 -..8 Aug..7.6 -.1.6 7.9 4. -.2 4. Sept. 4.. -.2 4.1 6.4 14.6.2 2. 6
The Italian economy in brief Number 128 December 217 Consumer price inflation and contributions of the main components (1) (monthly data; percentage changes over 12-months and percentage points) 4 2 1-1 2 26 27 28 29 21 211 212 21 214 21 216 217 Core components Volatile components Total 4 2 1-1 Source: Based on Eurostat data. (1) Harmonized index of consumer prices. The core component consists of non-food, non-energy and services; the volatile component is food and energy goods. Indicators of inflation in Italy (monthly data; 12-month percentage changes) Overall index Excl. energy HICP (1) CPI (2) PPI () Excl. Energy and food Overall index at constant taxation Overall index Overall index Non-food products 216 Aug. -.1.6.4 -.1 -.1-1..1 Sept..1.4.4..1 -.8 -.1 Oct. -.1.2.2 -.2 -.2 -.6 -.1 Nov..1..4.1.1 -. -.2 Dec...9.7...9 -. 217 Jan. 1..9. 1. 1. 2.9 -. Feb. 1.6 1..7 1. 1.6.7 -. Mar. 1.4 1.1.6 1.4 1.4. -.2 April 2. 1.4 1. 1.9 1.9 4.4 -.1 May 1.6 1.1.9 1.6 1.4.2. June 1.2 1. 1. 1. 1.2 2.. July 1.2.9.9 1.1 1.1.9.1 Aug. 1.4 1.1 1.2 1. 1.2 1.6. Sept. 1. 1.1 1.1 1. 1.1 1.7. Oct. 1.1.8. 1.1 1. 2.2.1 Nov. (4) 1.1.7.4.9 Source: Based on Istat and Eurostat data. 2 18 16 14 12 1 (1) Harmonized index of consumer prices. (2) Consumer price index for the entire resident population. () Index of producer prices of industrial products sold on the domestic market. - (4) Preliminary data. House prices and sales (quarterly data; indices, 21=1) 2 18 16 14 12 1 8 ' '6 '7 '8 '9 '1 '11 '12 '1 '14 '1 '16 '17 Prices Prices in real terms (1) Number of sales (2) 8 Sources: Based on Osservatorio del Mercato Immobiliare, Bank of Italy, Istat, and Consulente immobiliare data. (1) House prices deflated by the consumer price index. (2) Adjusted for seasonal and calendar effects. 7
The Italian economy in brief Number 128 December 217 1 Bank lending to the private sector (1) (monthly data; 12-month percentage changes) 1 1 1 - -1 Non-financial corporations Private sector Households 24 2 26 27 28 29 21 211 212 21 214 21 216 217 - -1 Source: Supervisory reports. (1) Includes bad debts, repos and loans not recorded in banks' balance sheets because they have been securitized. The percentage changes are net of reclassifications, exchange rate variations value adjustments and other variations not due to transactions; operations concluded with central counterparties are excluded. Interest rates on new loans (1) (monthly data; per cent) 6 6 4 4 2 2 1 2 24 2 26 27 28 29 21 211 212 21 214 21 216 217 Italy: loans to firms Euro area: loans to firms Italy: loans to households for house purchase Euro area: loans to households for house purchase 1 Source: Based on Bank of Italy and ECB data. (1) Averages. Data refer only to transactions in euros and are gathered and processed using the Eurosystem's harmonized method. 8
The Italian economy in brief Number 128 December 217 Credit access conditions for Italian firms a) Total (quarterly data) 1. 4.8.6 2.4 1.2. -1 28 29 21 211 212 21 214 21 216 217 Bank of Italy-Il Sole 24 Ore survey (1) (2) Istat survey (2) () (4) Bank Lending Survey, Italian banks (Right-hand scale) () -.2 b) By firm size (2) () (4) (quarterly data) 4 4 2 1 2 1-1 -1-2 21 211 212 21 214 21 216 217-2 Up to 49 workers -249 workers 249 workers or more Total (1) Source: Bank of Italy, Survey on inflation and growth expectations. The survey is conducted on samples of firms in industry (excluding construction) and services. - (2) Net percentage of firms reporting difficulty in obtaining credit calculated as the difference between the percentage of replies indicating a tightening of lending conditions and the percentage of those indicating an easing. - () Source: Istat, Monthly business confidence survey in the manufacturing sector. In June 21 some methodological changes involving the sample and data observation techniques were made precluding direct comparison with previous periods. - (4) Last survey in the quarter; since October 21, the questions on credit included in the Istat survey are set on a quarterly rather than monthly basis. - () Source: The euro area bank lending survey. Degree of credit supply tightening compared with the previous quarter (diffusion index). 9
The Italian economy in brief Number 128 December 217 Growth in bank funding: contributions of the various components (1) (percentage points and 12-month percentage changes) 1 12 9 6 - -6-9 21 211 212 21 214 21 216 217 1 12 9 6 - -6-9 Net liabilities towards central counterparties Deposits of non-residents Retail bonds Total funds raised Eurosystem refinancing Wholesale bonds Deposits of residents Source: Supervisory reports. (1) The sum of the contributions is equal to the percentage change over 12 months in the total funds raised. The percentage changes in the single components are calculated net of reclassifications, exchange-rate variations, value adjustments and other variations not due to transactions. Liabilities towards resident monetary financial institutions are excluded. Net liabilities towards central counterparties are the funds raised by way of repos with non-residents via central counterparties. Italian banks funding gap (1) (billions of euros and per cent) 2 2 4 1 1 2 1 - -1-1 2 24 2 26 27 28 29 21 211 212 21 214 21 216 217-2 Funding gap (2) Retail funding - 12-month growth Lending to residents - 12-month growth Funding gap as a percentage of lending Source: Supervisory reports. Excludes Cassa Depositi e Prestiti and branches of foreign banks. (1) Difference between lending to residents and retail funding (residents' deposits plus bank bonds subscribed by households). Last data at the end of October 217. - (2) Right-hand scale (billions). 1
The Italian economy in brief Number 128 December 217 General government net borrowing, primary net borrowing and debt (1) 6. 4.. 1.. -1. -. -4. -6. (percentages of GDP; the dotted lines indicate Government targets) Debt (2) Net borrowing Primary net borrowing (1) 26 27 28 29 21 211 212 21 214 21 216 217 1 1 12 12 11 11 1 1 9 Source: for the items of the 26-216 general government consolidated accounts, Istat; for 217 government estimates, Ministry of Economy and Finance, Update of the 217 Economy and Finance Document (September 217). (1) Overall balance net of interest payments. (2) Calculated according to the EC Regulation no. 29/479; Right-hand scale. Stock of government securities by type of investor and security (percentages) Rest of the world Bank of Italy Banks Other investors 1 1 7 2 1 7 2 21 214 21 216 217 Treasury bills Floating rate Fixed rate 7 2 1 7 2 Government benchmark bonds: gross yields to maturity (annual and monthly averages of daily data) CTZs BTPs year year 1 year year CCTs 21 1.61 2.21.11 4.2. 2.4 214.7.96 1.7 2.9 4. 1.6 21.19.4.77 1.72 2.77.71 216 -..8.46 1.48 2.6. 216 Dec...1.69 1.89 2.99.7 217 Jan. -.2.12.69 1.99.1.64 Feb....91 2..4.7 Mar... 1.17 2.4..7 April.1. 1. 2.26.26.7 May -.7.4.9 2.19.28.91 June -.7.22.78 2..2.87 July -.6.24.84 2.2.8.84 Aug. -.1.1.8 2.11.27.82 Sept. -.1.11.8 2.11.2.81 Oct. -.16.11.78 2.7..7 Nov. -.21.1. 1.79..4 11
The Italian economy in brief Number 128 December 217 Growth and inflation forecasts Italy (percentage change on previous period) Growth Inflation (1) 217 218 219 217 218 219 216 216 forecasts forecasts Bank of Italy (July) (2) 1. 1.4 1. 1.2 -.1 1.4 1.1 1.6 European Commission (Nov.) ().9 1. 1. 1. -.1 1.4 1.2 1. IMF (Oct.) (4).9 1. 1.1.9 -.1 1.4 1.2 1.4 OECD (Nov.) () 1.1 1.6 1. 1. -.1 1.4 1.2 1.4 Consensus Economics (Nov.) (6).9 1. 1.2 n.a. -.1 1. 1.1 n.a. (1) Forecasts for HICP. (2) Economic Bullettin No., 14 July 217. GDP data adjusted for calendar effects. () European Economic Forecast - Autumn 217. (4) IMF World Economic Outlook, October 217. () OECD Economic Outlook, November 217. GDP data adjusted for calendar effects. (6) Consensus Forecasts, 6 November 217. THE ITALIAN ECONOMY IN BRIEF DIRECTORATE GENERAL FOR ECONOMICS, STATISTICS AND RESEARCH Via Nazionale, 91 184 Roma - Italia Tel. +9647921 Registration with the Court of Rome No. 7/28, 26 February 28 12