Consumer sentiment plummets as Italians fear deepening crisis
CONSUMER confidence plummeted in Italy this month, official survey data showed yesterday, as the country continues to struggle through tough economic reforms.
The confidence climate index fell from 88.8 to a record low of 86.5, according to statistics agency ISTAT.
The drop was led by a fall in the economic climate component from 71.6 to 64.4, while the balance concerning the unemployment outlook rose from 106 to 113.
Confidence had remained surprisingly strong early in the year, rising from 91.4 in January to 93.8 in February and 96.1 in March despite Prime Minister Mario Monti’s planned austerity measures.
However, the deepening of the crisis in Greece, building worries in Spain and the implementation of some structural reforms in Italy have all knocked confidence since then, leading to the two consecutive monthly falls in the index.
Inflexible labour markets have been blamed for much of the loss of competitiveness in Italy, and Monti hopes that liberalising the industries, including taxi driving and pharmacy, will give the economy a boost in the medium and long-term, despite the short-term disruption it causes for those already in the sectors affected.