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Italy consumer morale rises in February from record low
February 22, 2013 / 10:05 AM / 5 years ago

Italy consumer morale rises in February from record low

ROME (Reuters) - Italian consumer morale recovered in February from an all time low the month before but Italians remained downbeat ahead of this weekend’s national election, data showed on Friday.

A worker cleans the exteriors of a shop near sales advertisements as people walk by in Madrid January 11, 2013. REUTERS/Susana Vera

National statistics bureau ISTAT’s headline consumer confidence index rose to 86.0 in February from 84.7 the month before. January’s data was marginally revised up from 84.6 but was still the lowest since the start of the series in 1996.

February’s index was well above the average forecast of 84.8 in a Reuters survey of 13 analysts and was the highest since October, though it remains close to historic lows.

Consumers are struggling through Italy’s longest recession for 20 years, with the economy contracting in every quarter since the middle of 2011.

Consumer spending over the last 12 months has fallen at its steepest rate since World War Two, according to ISTAT.

The rise in morale in February was largely due to improved sentiment on Italians’ personal finances, with this sub-index rising to 91.7 from 89.3.

Sentiment on the state of the economy edged up marginally to 72.9 from 72.7.

Tax hikes introduced by Mario Monti’s technocrat government as part of tough austerity measures have helped calm investor fears about the sustainability of Italy’s huge public debt but have eroded purchasing power and deepened the recession.

Most analysts expect gross domestic product to fall around 1 percent this year, following a contraction of around 2 percent in 2012.

Monti is running at the election on Sunday and Monday at the head of a centrist coalition but he is running a lowly fourth in the polls, lagging the centre-left, which leads, the centre-right and the anti-establishment 5-Star Movement headed by comedian Beppe Grillo.

Analysts say ISTAT’s consumer confidence index shows little immediate correlation with spending patterns, though it does reflect longer term trends.

Consumer spending has long been an achilles heel of the Italian economy, which has been the most sluggish in the euro zone for at least a decade.

Reporting by Gavin Jones

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