Italy: consumer confidence drops

Consumer confidence in Italy plummeted to a four-year low in March…

Economic think-tank ISAE reported last week that its consumer confidence index dropped from 102.8 points in February to 99 points March, while its index on consumers' views on the current economic situation fell from 107.8 points to 104.3 points and the index for short-term expectations fell from 96.6 points to 93.5 points.

ISAE's President Alberto Majocchi commented: “The percentage of Italians who felt prices have jumped considerably over the past 12 months reached a four-year high, while sharp drops were recorded for expectations to put away savings or purchase durable goods.

High degree of uncertainty

Marco Valli of Unicredit MIB added: "The main driver behind the fall is the worsening of the economic situation. With the lowering of growth forecasts being splashed on newspaper front pages for days, people have become increasingly aware. Another factor is the rise in prices which has affected products such as fuel and food -- two items that people notice."

A document recently issued by the Economy Ministry said the euro zone's third largest economy would grow just 0.6 percent in 2008, down from the 1.5 percent it had forecast last autumn.

"The Italian economy will be hit this year by the significant worsening of the international macro-economic situation and the high degree of uncertainty surrounding the global scenario," the document said.