Italy business morale improves in January but consumers more downbeat

ROME (Reuters) – Morale amongst Italian businesses rose in January but consumer confidence worsened, national statistics bureau ISTAT reported on Thursday, pointing to uncertain economic prospects at the start of the year.

ISTAT’s manufacturing confidence index increased to 102.7 from 101.5, beating a median forecast of 101.8 in a Reuters survey of nine analysts.

The overall business morale index, which also includes the retail, services and construction sectors climbed to 109.1 from 107.9.

Consumer morale, however, dropped to 100.9 from 102.5, missing a Reuters’ forecast of 102.7.

Economic growth in the euro zone’s third largest economy held up better than expected for most of last year despite sky-high energy costs exacerbated by the war in Ukraine.

However, gross domestic product probably contracted in the fourth quarter of 2022 and will also fall in the current quarter, according to Treasury estimates.

(Reporting by Gavin Jones)