ITALY

摘要

Faltering support in recent mayoral elections for Matteo Renzi's Democratic (PD) party indicates growing public dissatisfaction over tepid economic growth. The sluggish economy remains far below pre-crisis levels whilst also lagging behind the expansion rates of many Euro area neighbours. Nevertheless, Q1 2016 GDP growth of 0.3% (q-o-q) bettered that of Q4 2015, when GDP rose by an upwardly-revised 0.2%. Despite the economy returning to positive growth last year of 0.8%, our panel now anticipates that growth will only just exceed 1 % this year and next. Domestic demand continues to be the main source of support. Household consumption increased by 0.3% (q-o-q) in Q1, identical to Q4's rise. Gross fixed investment rose for a fifth consecutive quarter, albeit at a slower 0.2% pace, while industrial production also contributed positively. Brussels' decision to grant the government more budget flexibility this year should also pave the way for higher spending on structural reform efforts and infrastructure projects.