Italy’s economy likely recovered significantly in Q1 on strong domestic demand

The Italian economy is expected to have significantly recovered in the first quarter. A sharp rise in stocks and domestic demand is likely to have driven the economic growth. According to a Societe Generale’s research report, Italy’s real GDP growth is likely to have accelerated to 0.5% q/q in Q1 2016. The Q1 economic growth momentum is quite upbeat. Factory activity is expected to have performed much better than the activity recorded in Q4 2015 despite suffering a considerable setback in March. However, the Italian economy is likely to suffer some setback.

“The recovery, albeit too young to die, will likely remain modest (1.1% yoy in 2016, vs 0.9% in our previous forecast)”, added Societe Generale.