Swissquote Bank Research Team
Swissquote Bank Ltd
After March elections and the slow process of forming a government, the Italian economy is showing signs of weakness. A slowdown in February’s producer price index and industrial production month-to-month of 0.30% and -0.50% (prior: 0.80% and -1.80%) underline a decline in manufacturing morale, due to current political uncertainty. A major laggard is consumer goods (-2.40%; prior: +0.10%), but energy turned positive (+8.10%; prior: -6.90%). March manufacturing and economic confidence are lower at 109.1 and 106 (prior: 110.4 and 108.5), a pessimistic view on growth.
However, seen broadly, Italy’s economy remains stable, with an unemployment at a six-year low (10.90% in February), inflation accelerating (March’s consumer price index year-to-year +1.10%) and improving consumer confidence (117.50 as of March 2018, its highest since 31 January 2016). This supports our positive view of the Eurozone. Gaining 0.85% this week, EUR/USD bullishness started last Friday continues, bouncing from a 1.2215 low and heading to the 1.2390 range in the short-term (200-day moving average: 1.1963).
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This report has been prepared by Swissquote Bank Ltd and is solely been published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any currency or any other financial instrument. Views expressed in this report may be subject to change without prior notice and may differ or be contrary to opinions expressed by Swissquote Bank Ltd personnel at any given time. Swissquote Bank Ltd is under no obligation to update or keep current the information herein, the report should not be regarded by recipients as a substitute for the exercise of their own judgment.
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