According to the Bank of Italy, Italy’s economic performance keeps declining, its GDP and manufacturing production declined by 0.5% and 1.5% (q/q) correspondingly in the 2nd quarter of 2012.
The domestic consumption in Italy keeps declining as well, mainly due to the lending crisis and austerity. Multiple surveys confirm that the forecast for the future of the Italian economy remains negative. There are no positive signs of economic improvement at this point.
The central bank expects the rate of inflation to decline from 3.35 down to 3% in June 2012.
The IMF expects the Italian economy to shrink by 1.9% in 2012. Vittorio Grilli, Italian Finance Minister, confirms that the Italian economic decline won’t exceed the 2% limit.
In 2013, the Bank of Italy anticipates a 0.2% decline while the IMF expects it to be 0.3%.
Forex.
According to , EURUSD is flattish. In order to resume the mid-term rally, the price will have to break and consolidate above 1,2294 and 1,2306. If there is a bearish move, 1,2213 will become the closest major level of support. If the price consolidates below it, the long-term downtrend will resume.
