Italian Manufacturing Confidence Falls to Lowest in Two Years

(Bloomberg) -- (Bloomberg) -- Italian manufacturing and consumer confidence fell more than expected this month as the populist government worked to resolve a standoff with the European Union over next year's spending.

The business gauge dropped to 103.6 in December, the lowest since November 2016, from a revised 104.3 the month before, while the consumer gauge dropped to 113.1. Consumer confidence for the full 19- nation euro area is scheduled to be released later in the day in Luxembourg.

Key Insights

  • Drop in confidence may hinder government's push for more growth in 2019
  • Government has reduced its 2019 growth target to 1 percent from the 1.5 percent earlier goal
  • Confidence is last Italian economic data to be released in 2018, which has seen a slowdown in economic growth
  • Government will need to boost confidence to reach its future goals

National statistics agency Istat's confidence survey, released Friday in Rome, was conducted in the first half of this month.

Italy has suffered from years of near-stagnation and the European Commission says it expects the country to have the slowest growth rate in the 19-nation euro region this year and next.

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