GDP falls in the second quarter, alarm for domestic demand: the comment
The surprising GDP contraction in the second quarter was driven by domestic demand. As July inflation data suggest, the slowdown may also have affected demand for services. Based on business confidence and data on job marketwe believe that another contraction in GDP should be avoided in the third quarter.
After registering a surprising quarterly expansion of 0.6% in the first quarter, Italy’s GDP contracted by 0.3% in the second, doing worse than expected.
The brief press release from Istat indicates that iThe quarterly decline was driven by domestic demand (gross of stocks), while net exports had no impact on growth. From the point of view of supply, Istat notes that the added value has contracted both in industry and in agriculture and has expanded marginally in services.
READ ALSO: GDP, Italy slows down in the second quarter: -0.3%. Plus 0.6% on the year
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