Italian Unemployment Rate Climbs Back to Highest Since June

  • Consumer prices on annual basis fell for fourth month in May
  • GDP seen expanding 1.1% this year by IMF on slower pace

Italy’s unemployment rate rose more than estimated in April amid weakening business and household expectations for recovery in the euro region’s third-biggest economy. Consumer prices on an annual basis fell for a fourth month in a row in May.

The jobless rate rose to 11.7 percent from a revised 11.5 percent in March, national statistics agency Istat said Tuesday in Rome. The median estimate in a Bloomberg survey of eight analysts called for 11.4 percent in April. The reading matched the level in January and February, while the previous high was 12.2 percent in June.

“There are some positive signs that suggest the employment rate can improve, but there are still a number of obstacles ahead,” Andrea Brasili, economist at Pioneer Investment Management in Milan, said before the data were released.

In a separate release, Istat said that consumer prices rose 0.3 percent in May from the month before, while they fell 0.3 percent on an annual basis, the fourth drop in a row.

Italy is recovering from its longest recession since World War II.

Manufacturing confidence and consumer morale unexpectedly dropped this month, signaling pessimism among executives and households over the growth prospects, national statistics agency Istat said in a May 27 report. Earlier in the month separate Istat reports showed disappointing data for both industrial sales and orders in March.

Expressed Doubts

At an annual meeting of the country’s main business lobby Confindustria last week, its new president Vincenzo Boccia expressed doubts about the strength of the economy. Italy is forecast to expand 1.1 percent this year, the International Monetary Fund said in a report this month.

Istat expects the unemployment rate to fall to 11.3 percent in 2016, according to economic forecasts released on May 17. That is less than the 11.4 percent expected by Prime Minister Matteo Renzi’s government.

Youth joblessness increased in April to 36.9 percent from 36.7 percent in March, statistics office Istat said in the report.

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