Italy's economic recovery stops, as GDP growth falls to zero in Q2

There was no economic growth in Italy in the second quarter of the year, official data showed Friday, indicating that a fragile recovery in the eurozone's third-largest economy had ground to a halt.

Quarter-on-quarter, gross domestic product (GDP) was flat April-June, compared to a 0.3-per-cent expansion January-March and 0.2 per cent October-December, national statistics institute Istat said in a statement.

Analysts were expecting growth of 0.1-0.2 per cent.

On an annual basis, growth slowed down to 0.7 per cent, from 1 per cent in the previous quarter, Istat said.

The data is bad news for the government of Prime Minister Matteo Renzi, who was banking on 1.2-per-cent annual growth for 2016.

Weaker growth would worsen Italy's debt and deficit figures, and reduce margins for the government to adopt economic stimulus plans in the budget for next year, due to be presented in October.

Last update: Fri, 12/08/2016 - 10:26
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