The climate of business and consumer confidence continues to worsen. In October, Istat estimates a sharp decrease in consumer confidence (the index goes from 105.4 to 101.6) and in the composite business confidence index, which falls from 104.9 to 103, 9.
The business index – observes Istat – “extends to all sectors except construction. The overall index reaches the lowest value since April 2021”. “The consumer confidence index falls for the fourth consecutive month, reaching the lowest value since January 2023.” Look at Istat.
“There is a general worsening of all the nine variables that make up the indicator” both on the personal situation and on the general economic one “with the exception of expectations on unemployment, which are improving, and assessments on the family economic situation whose balance is growing slightly”.
In detail, the four indicators calculated monthly starting from the same components show negative dynamics: the economic climate and the future climate record the most significant declines (the first goes from 115.2 to 110.5 and the second from 113.2 to 107 ,7); the current climate drops from 100.2 to 97.4 and the personal climate drops from 102.2 to 98.6.
With reference to businesses, a reduction in the confidence index is estimated, albeit with different intensities, in manufacturing and services. In construction, in contrast, confidence is improving. More specifically, the confidence index drops in manufacturing from 96.4 to 96.0; in market services and retail trade the decline is more marked with the index going from 100.5 to 98.1 and from 107.1 to 106 respectively. In construction, however, the indicator rises (from 160.9 to 163.8).
As for the components of the confidence indices, in manufacturing the opinions on orders worsen while expectations on production grow and inventories are judged to be decreasing slightly. In construction all components improve.
Moving on to market services, both opinions on orders and those on business performance are worsening, while expectations on orders are increasing. As regards retail trade, assessments on sales are characterized by optimism in the presence, however, of an accumulation of inventories and a deterioration in sales expectations.
According to the usual quarterly questions on production capacity addressed to manufacturing companies, a decrease in the degree of plant utilization is estimated in the third quarter of 2023.
Unc, expensive life and expensive bills weigh on trust
The drop in the consumer confidence index from 105.4 to 101.6 in October is “A debacle for the Government!”. This was stated by Massimiliano Dona, president of the National Consumers Union. According to Dona, the “anti-inflation quarter, which started in October” had no effect on the confidence of consumers “forced every month to have to make ends meet and face the skyrocketing cost of living. In short, the collapse of confidence is a direct consequence of the effect of high living costs and high bills, which have a heavy impact on both the performance of the country’s economy and that of families” states Massimiliano Dona, president of the National Consumers Union. “In fact, expectations for both the economic situation of Italy have plummeted, from -27.2 to -42.9, and of the family, from -16.5 to -23.9. Things are not better, however, for the judgment on the economic situation of the family, which is true one of the few non-negative data, remaining substantially stable (from -41.5 to -41.1), but it is only an optical effect, a technical rebound due to the fact that the figure had already collapsed in September” concludes Dona.
Codacons, fears about high bills undermine confidence
“The risk of repercussions on the energy bill front linked to the conflict that broke out in Israel affects the expectations of consumers and companies” and undermines the climate of confidence. Business and consumer confidence recorded a new decrease in October, an extremely worrying sign especially on the consumption front”. This was stated by Codacons, commenting on the data released today by Istat. “The family confidence index recorded a further decline and that for businesses also decreases. The high cost of living that continues to prevail in Italy and the risk of repercussions on energy bills linked to the conflict that broke out in Israel impact the expectations of consumers and companies – explains Codacons – In the face of these emergencies, the measures launched by the Government, starting from the spending-saving basket, have not produced the desired effects: a worrying sign considering that lower consumer confidence corresponds to a lower propensity to spend on the part of families, which could lead to a consumption crisis”.
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2023-10-27 09:38:00
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