Italy’s economy eked out some growth in the third quarter after all instead of the stagnation originally estimated by the country’s national statistics institute.
Gross domestic product in the third-largest member of the euro region rose 0.1% in the three months through September, according to a release on Friday in Rome. Consumer spending and exports drove expansion in the quarter.
The outcome will partially offset a surprise revision revealed on Thursday in France, which unexpectedly contracted during the same period. That might help avoid a downward estimate of euro-zone GDP when a new number is released next week. The region’s economy was previously reckoned to have shrunk 0.1%.
The growth news will give another boost to Prime Minister Giorgia Meloni after Moody’s Investors Service removed its threat of downgrading the country to junk, and the European Commission refrained from outright criticism of the government’s looser fiscal stance.
Even so, the economy is still struggling to sustain meaningful expansion. On Friday, a survey of purchasing managers signaled that factory activity shrank for an eighth month in a row.
“Italy’s manufacturing industry is really taking a hit,” said Tariq Kamal Chaudhry, an economist at Hamburg Commercial Bank. “The shrinkage across the sector is extensive, and there’s no clear sign of how the sector could be pulled out of the current recession.”
Later on Friday, Italy could also draw attention with a potential update from Scope Ratings scheduled for after the market close.
The country is assessed at three levels above junk by the company, one step higher than the views of bigger rivals S&P Global Ratings and Fitch Ratings, and two notches up from that of Moody’s.
--With assistance from Giovanni Salzano.
(Updates with manufacturing PMI in fifth paragraph.)
