24.1 C
Delhi
Wednesday, December 6, 2023

Italian factories ‘trapped in recession’ – S&P

The country’s manufacturing sector has been contracting for six months, a new survey has revealed

Factories in Italy have seen a downturn for six months in a row, as manufacturing continues to decline in a sign of a deep industrial recession, Bloomberg reported on Monday, citing a survey by S&P Global.

An index based on responses from purchasing managers (PMI) stood at 46.8 in September, compared to 45.4 in August, well below the mark of 50, indicating a contraction.

Italian industry and manufacturing, in particular, have been struggling in the past several months due to a lack of new orders as global demand weakened.   

ADVERTISEMENT

“The Italian industrial economy appears to be trapped in a deep recession with no clear way out,” said Tariq Kamal Chaudhry, an economist at Hamburg Commercial Bank. “New orders, both domestic and international, are shrinking, and even expectations for future output have fallen well below their long-term average.”

Although the PMI survey indicated some increase in factory employment, it mainly pointed to a shortage of skilled workers, while the previous report by S&P said Italian factories had started to lay off staff due to a deeper contraction in industrial production.


READ MORE: Fewer Italians will work – data

Economists forecast that the manufacturing recession, which started in the Eurozone’s third-largest economy in the middle of last year, will continue.

ADVERTISEMENT

Manufacturing accounts for around 16% of Italy’s output but its weakness continues to weigh on the Italian economy, dragging it into further contraction.

The latest estimates showed that the country’s economy shrank by 0.4% – ahead of the 0.3% that had been predicted – in the second quarter of the year.

For more stories on economy & finance visit RT’s business section

ADVERTISEMENT

October 03, 2023 at 10:39AM
RT

Most Popular Articles