Italian Industrial Production Unexpectedly Falls
Oct 14, 2004
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Italian industrial production declined in August by the most in more than a year, further evidence that record oil prices are curbing growth in the 12 nations sharing the euro.
Output at Italian factories, utilities, and mines fell a seasonally adjusted 0.8 percent, the largest drop since May 2003, after rising a revised 0.3 percent in July, Rome-based national statistics office Istat said. Economists expected an increase of 0.1 percent, according to the median of 25 forecasts in a Bloomberg survey.
The cost of oil has risen by two-thirds this year, threatening to slow both export demand and household spending. Industrial production in Germany and France, Italy's two biggest trading partners, also fell more than economists expected in August, government reports in the past week showed.
"Oil prices are having the effect of hurting consumer spending and this is starting to have serious repercussions on the euro-region economy," said Francesca Panelli, chief economist at Aletti Gestielle Sgr in Milan. "Growth may stop."
Italian car production plunged 48 percent in August from a year earlier, partly because it is the holiday month when manufacturing slows, Istat said. Fiat SpA sales in Western Europe dropped 2.3 percent in September from a year ago, the Brussels- based European Automobile Manufacturers Association said.
Italian production of consumer goods, which accounts for 29 percent of the index, fell 0.8 percent from July on a seasonally adjusted basis, the report showed. Metal production decreased 2.3 percent from the previous month.(Bloomberg)
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