Global| Jul 28 2008Italy's Retail Sector Hits the Skids
Summary
Italy’s retail sector is in a bad way. Consumer sentiment ad retail spending usually mark one another pretty well. Right now both series are telling a dismal story about the Italian consumer. The recent drop-of in spending is severe, [...]
Italy’s retail sector is in a bad way. Consumer sentiment ad
retail spending usually mark one another pretty well. Right now both
series are telling a dismal story about the Italian consumer. The
recent drop-of in spending is severe, with most of the drop coming in
March and with no recovery (small real declines) in April and May.
In the quarter-to-date Italy’s real retail spending is
dropping at a 4.1% annual rate. This is in keeping with other signs
from the Euro Area that weakness has suddenly intensified. Even so the
Germany ministry is today saying that they are not going to change
their GDP outlook. There is a thin line that separates stoicism from
denial. The Euro Area seems to be sinking deeper into an undesired
economic funk. Meanwhile the ECB still sees inflation as public enemy
number-one. Only in the EMU’s UK do the monetary authorities seem to
have a grip on the true dual risk of their situation. Still they have
not magic policy plan but are marking time to see which risk blows out
of proportion and will need attention first.
| Italy Retail Sales Growth | ||||||||
|---|---|---|---|---|---|---|---|---|
| mo/mo % | At annual rates | |||||||
| Nominal | May-08 | Apr-08 | Mar-08 | 3-Mo | 6-Mo | 12-Mo | Yr Ago | Q-2-Date |
| Retail Trade | 0.2% | 0.1% | -0.6% | -1.5% | 0.0% | 0.1% | 0.6% | -0.7% |
| Food Beverage & Tobacco | 0.3% | 0.1% | -0.5% | -0.7% | 1.0% | 1.1% | 1.0% | 0.2% |
| Clothing & Furniture | 4.8% | -4.1% | -2.8% | -9.1% | -0.2% | -0.2% | 0.1% | -14.5% |
| Total Real Retail | -0.2% | -0.1% | -1.1% | -5.4% | -3.9% | -3.4% | -1.0% | -4.1% |
Robert Brusca
AuthorMore in Author Profile »Robert A. Brusca is Chief Economist of Fact and Opinion Economics, a consulting firm he founded in Manhattan. He has been an economist on Wall Street for over 25 years. He has visited central banking and large institutional clients in over 30 countries in his career as an economist. Mr. Brusca was a Divisional Research Chief at the Federal Reserve Bank of NY (Chief of the International Financial markets Division), a Fed Watcher at Irving Trust and Chief Economist at Nikko Securities International. He is widely quoted and appears in various media. Mr. Brusca holds an MA and Ph.D. in economics from Michigan State University and a BA in Economics from the University of Michigan. His research pursues his strong interests in non aligned policy economics as well as international economics. FAO Economics’ research targets investors to assist them in making better investment decisions in stocks, bonds and in a variety of international assets. The company does not manage money and has no conflicts in giving economic advice.
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