Short-term economic overview (18 July 2013)

In 2013 global GDP will grew by +3.0% as well as in 2012, reflecting a less strong contribution of the emerging countries compared with the past and a still negative contribution of the Euro Area (-0.7% in 2013). The USA will keep recovering (+1.8%) and Japan is expected to confirm recent positive performance (+2.6%).

Italy seems closer to exit from recession: the turning point is proved by the stabilization of industrial production and by the recovery of manufacturing orders (especially foreign ones) and confidence index. Italian GDP will start recovering from the fourth quarter 2013.

The European Central Bank decided to keep the main refinancing rate at 0.50% and, for the first time, it gave precise information about the future of the taxes that will “remain at present or lower levels for an extended period of time”.

Euro has appreciated a little over dollar: the dollar/euro exchange rate grew from 1.285 on 8 July 2013 to 1.3136 on 17 July 2013. Stability is forecasted for the rest of the year (Prometeia estimated an average rate at 1.30 in 2013).

Raw material prices continued to go down also in May: -3% according to Prometeia, after -1% in April.

Inflation grew in June but remained modest: 1.6% in the Euro Area (from 1.4% of May), 1.2% in Italy (from 1.1%) and 1.3% in Milan (from 1.2%).

The unemployment rate increased in May to 12.2% in the Euro Area and to 7.6% in the USA (although showing a decreasing trend). Among European countries, it declined in Germany (5.3%) while it rose in France (10.9%), in Spain (26.9%) and in Italy (12.2%).

In June the manufacturing confidence index¹ kept recovering in the Euro Area thanks to increasing orders and production expectations (whose balance turned slightly positive after fourteen consecutive months of negative sign). Among main economies of the Euro Area, the index grew for the second consecutive month in France, Italy and Spain and it restarted to increase in Germany after three declining months (for Italy data of June have to be carefully read because of a statistical methodological discontinuity). In the area of Milan the manufacturing confidence index declined in May 2013 back to the values of March 2013, remaining on the most highest values of the last two years, though. All components contributed to the contraction of the index: both orders and production expectations decreased, inventories of end products increased but still remaining under normal levels for the fourth consecutive month.

Italian exports remained week also in May: -1.5% compared with the same month of the previous year due to a consistent decrease of exports to EU (-3.4%), not compensated at all by the increase to Extra-UE (+0.7%).

Prometeia and Bank of Italy forecasted a contraction by -1.9% for the Italian GDP in 2013 and an increase by +0.7% in 2014. The recovery will be driven by exports (positive contribution from the second quarter 2013), than by investments (positive from the fourth quarter 2013) and finally by household expenditure (positive not before 2014).

In the first half year 2013 the total amount of authorized hours of CIG² grew by 4.6% at national level while they contracted by 2.3% in the area of Milan. More in detail, in the Area of Milan CIG was almost stable in June 2013 both over May 2013 and June 2012, but this stability was the result of different trends of its components: CIG in Deroga plummeted (-92%) while CIG Ordinaria grew considerably (+48%). The growth of CIG Ordinaria affected in June also the Assolombarda companies, whose amount of authorized hours was even higher (+54%) than that of the whole area of Milan.

Footnotes

1 Data referred to European countries are extracted from the monthly survey on manufacturing sector harmonized by the European Commission. Assolombarda carries out an analogous survey interviewing 350 associated companies every month. The manufacturing confidence index is the main indicator of these surveys and is calculated as the mathematical average of the seasonally adjusted data on production expectations, orders and stock of finished products (with inverted sign).

2 Cassa Integrazione Guadagni (CIG) is a particular Italian shock absorber. It is a redundancy fund which helps companies to keep labour force in times of economic difficulties. It allows workers to receive a part of their wages. There are three kinds of CIG: Ordinary (Cassa Integrazione Ordinaria - CIGO), Extraordinary (Cassa Integrazione Straordinaria - CIGS) and Special (Cassa Integrazione in Deroga - CIG in Deroga).

Contact us

For further information please contact the Research Department tel. +390258370.409, e-mail stud@assolombarda.it.