On the business front, the picture is mixed. Confidence declines in Italian manufacturing and services but improves in construction and retail.
The fourth consecutive decline in manufacturing confirms that the sector’s soft patch is far from over. As for the components, we note a clear deterioration in orders (both domestic and foreign) and small declines in current production and inventories. It’s not exactly the best mix for an imminent rebound in manufacturing production.
Today’s release also signals that in the third quarter, capacity utilisation in manufacturing declined further to 75.1%, the lowest level since the second quarter of 2020, in full pandemic times. It also adds that the main obstacle to production is, by far, the lack of demand, with the role of manpower availability gradually receding. This limits the scope for an imminent acceleration in machinery investments, otherwise stimulated by renewed incentives.