- Previously 49.5
- Overall PMI 48.6
- 48.1 and earlier
Italian services activity contracted slightly again in December, with production declining for the fifth consecutive month while the decline in new orders accelerated. Demand conditions remain weak and are proving to be a drag on Italy’s key sectors. HCOB points out:
“Italy’s services sector is hitting the brakes just before the end of the year. The HCOB PMI in December stalled at 49.8, indicating stagnation. This means that the services sector will significantly boost GDP growth in the fourth quarter. Suggests it’s unlikely. It’s true.” Our HCOB nowcast model doesn’t show any positive signs for Italy’s GDP growth as we head into the new year.
“Despite the cooling economic situation, Italian service workers are still actively hiring. Although the rate of employment growth may not be setting records, it has been According to Service Confidence, the November index released by ISTAT showed that respondents increasingly expected jobs to fall over the next three months.
“Inflation for service providers remains persistent. Despite the fact that the Italian services sector has not seen growth since July 2023, according to the HCOB PMI, inflationary pressures are still quite high. The only hope is that there is a gap.”Although the difference between input and selling prices has narrowed compared to the previous month, the lack of pricing power remains a headache for Italian service providers.
“The outlook for 2024 looks quite grim. Both gross order book and international order book are on a downward trend, leading to an expected decline in backlog business. “Clouded by the uncertainty and global economic downturn,” coupled with geopolitical tensions abroad, the beginning of the year will be a difficult period for Italian service providers. ”