MNI: ITALY DATA: Flash GDP (Q2 2019) ................>

MNI: ITALY DATA: Flash GDP (Q2 2019) 

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- Contrary to market expectations, the Italian economy managed to avoid tumbling

back into contraction in Q2...

- ... but only just as growth came in flat on both a q/q & y/y basis

- Meanwhile, Q1 growth was confirmed at +0.1% q/q & -0.1% y/y

- While an expenditure breakdown is not provided with the flash release, Istat

reports that industry & agriculture contracted over Q2 while services expanded

- This is in line with recent high frequency data and survey results 

- Indeed, the Manufac PMI remained in contraction throughout the quarter

- ... while the Services PMI indicated continued growth in the sector, with

sentiment among firms even picking up to a 14-month high in Jun

- Looking ahead, the economy is unlikely to see a brighter performance in the

second half of the year, and remains at risk of falling back into recession

- Indeed, as well as external headwinds, the domestic environment remains

challenging amid political noise and  anaemic productivity growth