Italian economy contracts in Q4, sending it to recession

Italy is Europe's second-largest manufacturer and is currently the only European Union member in recession.

The Italian economy contracted in the fourth quarter of 2018, dragged down by slowing European growth and global trade tensions, plunging the country into a technical recession, official data showed on Thursday.
The 0.2 per cent contraction - following a 0.1 per cent fall in the third quarter - will put pressure on the populist government in the eurozone's third-largest economy, which took power in June on the back of big-spending electoral promises.
Italy is Europe's second-largest manufacturer and is currently the only European Union member in recession, although growth in export powerhouse Germany also fell in 2018. The Italian economy suffered a harsh recession in 2012-13 and has enjoyed only slow growth since then. Overall growth for full-year 2018 was just 0.8 per cent.
The eurozone economy stuck to its lowest pace of growth in four years in the final three months of 2018, with the rate of expansion in the year as a whole also the slowest since 2014, data showed on Thursday.
GDP in the 19 countries sharing the single currency rose by 0.2 per cent in the quarter and by 1.2 per cent year-on-year, the European statistics agency Eurostat said in its first estimate.
In 2018 as a whole, the eurozone economy expanded by 1.8 per cent, down from growth in the past three years, of 2 per cent or above.
Italy's Prime Minister Giuseppe Conte had anticipated the bad news during a business conference in Milan.
"Analysts tell us we'll likely still suffer a bit at the start of this year," he said, pointing the finger at a slowdown in China and Germany which are hurting Italian exports.
"But all the elements are there to recover in the second half," Conte added.