The National Institute of Statistics (Istat) has released its monthly report on the performance of the Italian economy for November-December 2023. As the year concluded, international economic prospects remained highly uncertain, shaped by ongoing geopolitical tensions with no immediate resolution in sight, coupled with persistently tight financial conditions for households and businesses. In November, Italy witnessed a more pronounced sequential decline in its industrial production index compared to the previous month. This downturn affected all major industry groupings, reflecting the challenging economic landscape. Despite a fourth-quarter decline in 2022, the purchasing power of households has shown signs of recovery. A similar trend was observed for savings propensity, which, however, continues to lag behind pre-Covid levels.
Labor market conditions remain robust, with increases in employment and inactivity observed in November, while the number of unemployed individuals decreased compared to the previous month. Throughout 2023, the average inflation, measured by the harmonized index of consumer prices (HICP), receded to 5.9% from 8.7% in 2022. This progressive reduction reached 0.5% in December. Notably, Italy's price growth since October has been lower than the average for the eurozone. December's survey results indicate an improvement in the confidence levels of both households and businesses, approaching the levels seen in July 2023. Looking ahead, the next update on Italy's economic performance is scheduled for March 12. The reporting frequency will shift to a bimonthly schedule, featuring in-depth analyses of economic and methodological aspects, as the report evolves to provide a more comprehensive understanding of Italy's economic dynamics.
