ROME (ITALPRESS) – “The issue of U.S. tariffs is in danger of absorbing all the attention of the media debate. A world with more tariff barriers is worse than one without or with moderate duties. However, the current threats of the U.S. administration toward Europe seem surreal. In fact, in 2023, European exports of goods to the U.S. totaled about 504 billion euros and imports over 347 billion euros (balance of 157 in favor of Europe). In contrast, Europe 27’s exports of services to the U.S. are worth nearly 319 billion euros, while European imports of services from the U.S. exceed 427 billion euros (balance of 108 in favor of the U.S.). Thus, the overall “real” balance that would be detrimental to the U.S. economy, directly caused by the interchange with the Europe 27, is about $52 billion, or 0.18 percent of U.S. GDP. In assessing the Italian economic picture, we will assume, therefore, that reasonable negotiations lead to a trade pattern not too dissimilar from the current one. Official economic indicators for the first two months of this year are more ‘green’ than ‘red’: growth, perhaps stunted, but not reduction. All this considered, the Confcommercio Consumer Indicator estimates remain positive in the seasonally adjusted data metric: +0.2 percent and +0.1 percent in January and February. But in the raw metric, the change in calendar days depresses the parameters, delivering two minus signs to the statistics, with February (-0.9%) penalized by the comparison with the similar leap month of 2024″. This is stated in a note from the Confcommercio Studies Office.
“Beyond the technical details, the issue of higher real disposable income not being transformed into higher consumption still appears unresolved,” Confcommercio further writes. “In the first two months of the year, support for consumption comes from the enjoyment of leisure and tourism: recreational services and goods, hotels and restaurants, air transport and telecommunications are up, even noticeably. In contrast, food, transportation equipment, furniture and household appliances appear to be declining. Clothing and footwear take an intermediate position between these extremes. The dynamic services vs. goods gap does not appear to be shrinking, while in January partial estimates of tourist arrivals in Italy show robust growth, especially for the foreign component (+8 percent compared to 2024 and +18.2 percent compared to January 2019). Good news on the inflation front. Our last forecast for February stood at 2%, against an actual figure of 1.6%, which we expect to be up marginally in March (1.7%). The issue of excessive energy costs is central, but no easy solutions are in sight in the short term. Italy, although less than in the past, remains largely subject to exogenous impulses from abroad, with reduced ability to mitigate in the short term. The resilience of employment, the recent rebound in industrial production, and the good performance of tourism, inflation and real incomes, still provide the preconditions for a boost to growth through a recovery in consumption.”
“Monthly GDP would grow in trend and seasonally adjusted terms by seven tenths in March, after two moderate increases in January and February (+0.3 percent and +0.1 percent). Growth in the first quarter would be at 0.4 percent compared to the same quarter in 2024. Therefore, in this scenario, which will not be able to take advantage of favorable statistical corrections as last year, growth at 0.8 percent overall in 2025 requires acceleration. Possible but, again, all to be achieved. Favorable external impetus may be needed in this context, such as putting the further steps of tax reform in the direction of lower legal rates for the productive class back at the center of the political-media debate. This issue also takes on depth in light of the growing dynamics of the tax burden, which reached 42.6 percent on average last year. In February 2025, the Confcommercio Consumer Indicator (CCI) showed a decrease of 0.9 percent compared to the same month in 2024. The estimate is a summary of a decrease in spending on goods (-1.7 percent) and a 0.7 percent growth in services. For a better reading of the figure-which attests to the continuing weakness in demand-it should be noted that the annual comparison is also affected by the different number of days in the month in the two years. In fact, the seasonally adjusted figure shows a very modest increase in both cyclical and trend terms (+0.1 percent). In February 2025, the dynamics of the different consumption functions that make up the CCI are also highly articulated, a further symptom of the difficulties of consumption to get on a growth path. Among the different spending functions, the most positive dynamics, in annual comparison, are confirmed to be those related to communication goods and services (+5.3 percent). Demand for hotels and meals and eating out also remains in positive territory (+1.3%), a segment that continues to benefit from the positive contribution of the foreign component of demand. In February, appreciable signs of recovery involved consumption of clothing and footwear (+1.4 percent), improving on the less than brilliant results of the January sales.”
“Among the macro consumption functions, consumption related to mobility goods and services (-5.9 percent), recreational goods and services (-1.6 percent) and household goods and services (-1.3 percent) are confirmed to be in negative territory. Returning to negative territory are personal care goods and services (-0.8 percent) and food beverages and tobacco (-0.6 percent). The overall data underlie, as usual, articulated trends in the various expenditure functions included in the aggregates. At the level of individual consumer items, the improving trend in demand for air transportation (+7.1 percent) and recreational services (2.9 percent) persists. The crisis in the automotive sector deepened in February, with a year-on-year decline of 11.2 percent in demand for new cars by individuals and furniture and home furnishings (-1.2 percent). Signs of deterioration are also confirmed for household appliances (-2.2 percent) and fuels (-1.6 percent). On the basis of the trends recorded by the different variables that contribute to the formation of consumer prices, a 0.2 percent change in the index is estimated for March in cyclical terms and a 1.7 percent growth on an annual basis. After the fibrillations of January, inflationary dynamics seem to have stabilized. The easing of some pressures on energy and food, together with core inflation remaining below 2 percent, lead confirm the assumption of a change in consumer prices at current values in the coming months as well. In a context where the factors of uncertainty are multiple, the easing of fears of a ‘major’ recovery in inflation is one of the elements necessary to restore the confidence of households and push them to consumption attitudes more compatible with employment and income dynamics. Only with a normalization of the income-consumption circuit, which seems to have jammed in recent years, will it be possible to achieve, in the presence of difficulties on the export front and uncertainties in business investment decisions, the growth targets set for 2025″ concludes the analysis of the Confcommercio Consumer Indicator.
-Photo IPA Agency-.
(ITALPRESS).
