Italy’s industrial output plunged at its fastest rate in almost two years in December, data has shown, in a worrying sign for the Eurozone economy.
Production fell 2.7 per cent month on month, the biggest fall since January 2018 and far below the 0.5 per cent predicted by analysts in a Reuters poll.
The data from Italy’s official statistics body showed that industrial output fell 4.3 per cent year on year in December, with 13 of 16 sub-sectors in decline and mining and quarrying performing the worst.
Over the whole of 2019, industrial output was down 1.3 per cent, indicating the long-running nature of Italy’s manufacturing decline.
The Italian data came after a week of mixed signals from the Eurozone economy.
In Germany, Europe’s biggest economy, industrial production posted its biggest increase in a year and a half in November, data showed last week.
But data from just three days before showed that new orders fell 2.1 per cent in December.
The Eurozone had a rocky 2019 as global trade tensions, German and Chinese weakness, and an international slowdown weighed on growth.
The OECD predicted that the euro area economy grew by 1.2 per cent in 2019, its weakest since 2013, when the zone was locked in financial crisis.
“The hard data do point to weak growth momentum,” Morgan Stanley analysts said in a note.
Nonetheless, they said that despite the weak data and emerging downside risks, “we continue to believe that our thesis of a gradual growth acceleration isn’t derailed – at most it could be delayed”.