The outlook for Italy's economy has brightened slightly over the last three months, with a timid return to growth seen in 2010, but the country's finances are likely to deteriorate even further, according to a Reuters poll. The median forecast in the quarterly survey of around 20 analysts points to a 4.9 percent drop in gross domestic product (GDP) this year.
That would be the steepest for more than 50 years but an improvement on the 5.2 percent contraction envisaged in Reuters' previous poll in July, reflecting signs of a global upturn. After five consecutive quarters of falling GDP, encouraging industrial output figures recently have supported predictions for growth of 0.2 percent in the third quarter of this year.
For 2010 the survey forecasts growth of 0.5 percent, up from 0.3 percent previously, but analysts cautioned that a recent rebound in Italian manufacturing is likely to peter out at the start of next year. "At the moment manufacturing is making up for lost ground with a strong reversal of the de-stocking we saw around end-2008, but we don't think this is sustainable and growth will fall back again early next year," said Luigi Speranza of BNP Paribas.
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