Recent developments for the eurozone's third largest economy have not been good.
Back on Aug. 6, the New York Times said:
The Italian economy shrank in the second quarter ... taking economists by surprise ... . Italy’s gross domestic product contracted 0.2 percent from April through June, compared with the first quarter of 2014, Istat, the Italian statistics office. It was the second quarterly decline in a row for Italy ... . In the first quarter, output shrank 0.1 percent compared with the previous quarter.
Now, Italy has just posted its second straight month of deflation. Read this excerpt from a Sept. 30 Reuters story:
Italian EU-harmonised consumer prices (HICP) rose 1.8 percent in September from the month before but were down 0.2 from the year earlier, preliminary data showed on [Sept. 30], adding to concerns about deflation.
The HICP reading exactly matched the median forecast in a Reuters survey of 18 analysts and marked the second straight month of falling prices on an annual basis. The 0.2 percent drop was identical to August's result.
ISTAT also reported that the main domestic price index (NIC) fell a preliminary 0.3 percent on the month, and declined 0.1 percent annually.
Here's the link to the entire article: http://uk.reuters.com/article/2014/09/30/uk-italy-deflation-idUKKCN0HP0T520140930