Europe News

Italy unexpectedly slides back into recession

Italy back in recession
Italy back in recession

Italy's economy unexpectedly slid back into recession in the second quarter as gross domestic product shrank 0.2 percent from the first three months of the year, preliminary data showed on Wednesday.

The result was below all forecasts in a Reuters survey of 25 analysts, which had pointed to a second quarter GDP gain of 0.2 percent. Forecasts ranged from -0.1 percent to +0.4 percent.

Gross domestic product fell 0.3 percent year-on-year in the second quarter, below a median forecast for a 0.1 percent gain, official statistics agency ISTAT reported.

Italy's economy, the euro zone's third-biggest, grew by just 0.1 in the fourth quarter of last year, expanding for the first time since mid-2011. But in the first quarter of 2014 the economy again shrank by 0.1 percent.

ISTAT gave no numerical breakdown of GDP components with its preliminary estimate, saying only that activity in industry, services and agriculture contracted.

ISTAT said so-called "acquired" GDP at the end of the second quarter stood at -0.3 percent.

This means that if GDP posts a flat quarterly reading in the final two quarters of 2014, over the whole year it will be down 0.3 percent from the previous year.

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