ROME (ITALPRESS) – The economy grew 0.4 percent in the third quarter of 2024, exceeding expectations. Growth was mainly driven by increased consumption, partly reflecting one-off factors that boosted tourism over the summer, and stockpiling by businesses. However, the most recent data show a loss of momentum. Surveys point to continued contraction in the manufacturing sector and slowing growth in the services sector. This is according to the European Central Bank’s Economic Bulletin. “Firms are restraining investment spending in the face of weak demand and high uncertainty about the outlook. Exports are also weak and some European sectors are finding it difficult to remain competitive,” the ECB explains. The labor market continues to hold up well. Employment rose 0.2 percent in the third quarter of 2024, again exceeding expectations. The unemployment rate remained at a record low of 6.3 percent in October. At the same time, labor demand continues to weaken. The vacancy rate fell to 2.5 percent in the third quarter, a level 0.8 percentage points below its peak, and in addition, surveys report a decline in jobs created in the fourth quarter. “The gradual recovery of the euro area economy is expected to continue in the coming years amid considerable geopolitical and economic uncertainties. In particular, rising real wages and employment, in the presence of robust developments in labor markets, should support a recovery in which consumption would be confirmed as one of the main determinants. Domestic demand would also be supported by the easing of financing conditions, in line with market expectations about the future profile of interest rates,” the Economic Bulletin further states.
– Photo Agency Photogram –
(ITALPRESS).
