31st Oct 2014 17:47
Rome (Alliance News) - Italy, which has been stuck in a recession for the last three years, is unlikely to recover from its slump in the last quarter of the year, national statistics agency Istat warned on Friday.
"The cyclical outlook of the Italian economy will remain weak," Istat said in a monthly report.
It noted that its leading composite indicator, which the agency uses for forecasts, "continues to show a slowing down of economic activity in the final months of the year."
Earlier this month, Prime Minister Matteo Renzi unveiled an expansionary budget, in an attempt to revive the economy. His government expects gross domestic product to shrink by 0.3% this year, and expand by 0.6% in 2016.
"The Italian economy is going through one of the most severe and lengthy recessions in its history," Economy Minister Pier Carlo Padoan wrote to EU authorities on Monday, justifying a softening of austerity policies.
"The economy is now in its third year of recession and at serious risk of deflation - or a prolonged period of very low inflation - and stagnation. A fourth year of recession is to be avoided at all costs," he added.
Copyright dpa