The Limited Times

Now you can see non-English news...

Confindustria: from ECB rate hike ballast on businesses

2022-11-26T09:14:25.515Z

Falling liquidity and growing debt burden worry. Risk of production decline in the fourth quarter. Negative indicators, weigh energy, inflation, rates and exports (ANSA)



The ECB's rate hike constitutes "another ballast on business costs", and risks "making the scenario worse, at least in the short term".

This can be read in the Congiuntura Flash of the Confindustria Study Centre, which notes how the rate on BTPs "has already begun to transfer to the rates paid by companies in Italy", which up to September increased by almost one percentage point "and seem destined to rise a lot moreover".

In addition, "the rapid decline in liquidity" of companies added to a debt burden which "will absorb a growing share of company turnover" is worrying.

Italian industry "continued to hold its own in terms of production" also thanks to the relative drop in the prices of non-energy raw materials and government interventions, but "there is a risk of a decline in the fourth quarter: the qualitative indicators are overall negative" .

The Confindustria Study Center writes it in the note 'Congiuntura Flash', which sees a "curb on investments" in a scenario "that had already veered towards recession" between the impact of record inflation on households and consumption, rate hikes and, in perspective, a "weakness in foreign demand".

The sharp rise in gas prices in November, after the sharp decline in October, risks a clear correction in the coming months of industrial production in Italy, which despite the marked decline in September (-1.8%) on average in the third quarter had fallen slightly (-0.4%, with manufacturing holding steady at -0.1%).

The increase in inventories since April, together with the smaller decline in the quarter, suggest that some companies have anticipated production by taking advantage of existing energy contracts before the increase in energy prices actually paid.

"This - we read - could herald a marked fall in the coming months" given that the qualitative indicators have also worsened, "tracing the course for a heavier minus sign in the fourth quarter".

The construction sector is also bad, where - writes the Study Center - "the slowdown is confirmed, which was signaled by the indicators on building sites in sharp decline".

The sector's production grew slightly in September (+0.2%) and on average in the third quarter recorded a decrease (-2.2%), after no less than 6 consecutive quarters of strong expansion.

Mixed signals, however, for services in the fourth quarter after the rebound in the summer thanks to the recovery of tourism: in October the services PMI fell (46.4 from 48.8), while consumer confidence recovered ground in November.

after 6 consecutive quarters in strong expansion.

Mixed signals, however, for services in the fourth quarter after the rebound in the summer thanks to the recovery of tourism: in October the services PMI fell (46.4 from 48.8), while consumer confidence recovered ground in November.

after 6 consecutive quarters in strong expansion.

Mixed signals, however, for services in the fourth quarter after the rebound in the summer thanks to the recovery of tourism: in October the services PMI fell (46.4 from 48.8), while consumer confidence recovered ground in November.

Source: ansa

All life articles on 2022-11-26

You may like

Trends 24h

Life/Entertain 2023-02-07T09:49:54.501Z
Life/Entertain 2023-02-07T11:02:34.000Z

Latest

© Communities 2019 - Privacy