Italian business, consumer confidence slump in March

Bloomberg

Confidence among Italian businesses and consumers fall sharply on concerns about the economic consequences of Russia’s invasion of Ukraine.
The economic sentiment index fell to 105.4 in March from a revised 107.9 in February, statistics office Istat said. Measures of consumer and manufacturing confidence both declined, with the former reaching its lowest level since January 2021.
Expectations for orders and sales worsened in manufacturing, services and commerce, with construction the only sector where optimism remains, the statistics institute said. Consumers expect both Italy’s economy and their personal situation to worsen and are less willing to invest in durable goods, according to the
statement.
Finance Minister Daniele Franco said this week that Italy’s economic growth is set for a potentially significant downgrade because of the war, which is adding to energy-price inflation and supply disruptions. The European Commission currently forecasts expansion this year of 4.1%.
The government has spent more than 16 billion euros ($17.6 billion) on cushioning the impact of rising energy costs on families and businesses, and recently passed further measures including a tax cut on fuel prices at the pump. The Treasury is set to release its new budget plan as soon as next week, when growth and deficit goals may be reviewed.