Note on Italian economy - July and August 2025

IIn the second quarter of 2025, GDP is recovering in the United States, slowing in China and in the euro area. However, global economic growth prospects remain highly uncertain, with negative signals emerging from leading indicators of international trade. 

In Italy, GDP recorded a slight decline in the second quarter (-0.1% quarter-on-quarter): while exports fell and inventories increased, private consumption remained stable and investment dynamics, although slowing, were still positive. 

The second quarter also saw a deceleration in Italian trade, primarily driven by a reduction in exports to non-EU markets: this downturn in exports to the United States was accompanied by pronounced declines in shipments to the United Kingdom, China, Russia, and Turkey.  

The industrial production exhibits quarter-on-quarter growth in July for the second consecutive month; manufacturing confidence decreased in August, whereas confidence in the services sector increased.  

The labor market continues to demonstrate resilience, evidenced by a further increase in July in both the number of employed individuals compared to the preceding month (+0.1%, or +13,000) and in the employment rate (62.8%, +0.1 percentage point). Employment levels among professional categories increased for both permanent and temporary positions, while they decreased among self-employed individuals.  

Consumer price inflation, as measured by the Harmonized Index of Consumer Prices (HICP), remained stable in August on a year-on-year basis (+1.7%). Inflation for consumer goods (including food, household items, and personal care products) continued to accelerate, reaching 3.5%.