Italian Business Confidence Rises in June After Letta Measures
Italian business confidence rose this month after Prime Minister Enrico Letta’s Cabinet passed plans to boost employment and postponed the payment of the value-added tax planned for July.
The manufacturing-sentiment index rose to 90.2, the highest since March 2012, from a revised 88.7 in May, Rome-based national statistics institute Istat said today. Economists had predicted a reading of 88.9, according to the median of 13 estimates in a Bloomberg News survey. The index is based on a poll of about 4,000 businesses.
On June 26, Letta’s cabinet approved a series of measures to try to increase hiring of young people after the jobless rate reached a 36-year high in April. In an effort to spur consumer spending, Italy also decided to postpone a scheduled sales-tax increase until Oct. 1, with the possibility of delaying it further. The euro region’s third-biggest economy is probably in its eighth quarter of economic contraction and is forecast to shrink 1.9 percent this year, business lobby Confindustria said in a report yesterday.
Consumer confidence increased in June amid households’ hopes of an economic recovery later in 2013, Istat said earlier this week. Still, industrial output unexpectedly fell for a third month in April, signaling that the recession Italy entered at the end of 2011 may extend to the second half of this year.
Istat originally reported a business confidence index at 88.5 in May.