ISTAT said Wednesday that it has revised down its forecast for Italy's GDP growth this year from 1.3% to 0.3%. The statistics agency added that the sharp deceleration of economic activity will hit the labour market, with unemployment set to rise to 10.8% this year, compared to 10.6% in 2018. In November ISTAT had forecast Italy's unemployment rate for 2019 would be 10.2%.
"In 2019, GDP is expected to increase by 0.3% in real terms," ISTAT said.
"Domestic demand will provide a contribution of 0.3 percentage points while foreign demand and inventories will provide a null contribution.
"In 2019, exports will increase by 1.7% and imports will grow by 1.8%. "Residential households consumption expenditure is expected to grow by 0.5% in 2019. "The stabilisation in employment and the wages increase will support households purchasing power. Investment are expected to decelerate (+0.3%).
"Labour market conditions will stabilize over the forecasting period. "Employment growth is expected to increase at 0.1% in 2019.
At the same time, the rate of unemployment will slightly increase at 10.8% in the current year.
"This projections take into account the less favourable international framework".
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