Italian business sentiment improves in December but consumers are more pessimistic by Reuters

ROME (Reuters) – Sentiment among Italian businesses and consumers moved in opposite directions in December, with sentiment among businesses recovering from recent lows but consumer confidence falling for a third straight month, data showed on Friday.

The data paints an uncertain picture heading into next year for the euro zone’s third-largest economy, which has faltered in recent months.

The National Institute of Statistics’ composite business sentiment index, which combines surveys of the manufacturing, retail, construction and services sectors, came in at 95.3, rebounding from its lowest level in more than three years of 93.2 in November.

The sub-index measuring sentiment among manufacturers fell to 85.8 from 86.5, but this was outweighed by a strong improvement in services sector sentiment, which jumped to 99.6 from 93.9.

The institute said consumer confidence fell this month to 96.3 from 96.6 in November, below the average forecast of 97.0 in a Reuters poll of analysts.

Italy’s GDP stagnated in the third quarter compared to the previous three months, and ISTAT said it did not expect any recovery in the fourth quarter.

This month, it forecast full-year growth at about 0.5%, half the government’s official target of 1.0%.

Most analysts and forecasting institutes also expect growth next year to be well below Rome’s official forecast of 1.2%.