Italy is on a roll right now.
Growth in Italy’s industrial sector came in well ahead of forecasts in July, the latest in a series of better than expected economic data out of the eurozone’s third-largest economy.
Output increased 4.4 per cent year on year, when adjusted for working days. That marked a slowdown after a bumper June, but was much better than the 3.5 per cent expansion economists had expected.
Surveys suggest the strong growth is likely to continue: Italy was one of the stand-out performers in the latest PMI surveys of eurozone manufacturers, and economic confidence hit a post-financial crisis high in August. That optimism has also been reflected in increasing labour force participation, as residents are increasingly confident that they will be able to rejoin the market and find jobs after years of lagging behind the rest of the eurozone.
Paolo Pizzoli, senior economist at ING, said the latest figures “bode well for a continuation of a sound GDP expansion in Q3″:
The takeaway from today’s release is that industrial recovery is in place and is spreading across sectors. The good news is that activity is accelerating in the investment goods arena, suggesting the investment component is ultimately responding to existing domestic fiscal stimuli and resilient external demand.