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Italy's economy stagnates in second quarter after marginal first quarter growth

Italy's economy stagnates in second quarter after marginal first quarter growth
FILE PHOTO: Workers stand on a scaffolding with safety belts in Duomo's square downtown Milan, Italy, May 18, 2016. REUTERS/Stefano Rellandini -
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Stefano Rellandini(Reuters)
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ROME, July 31 (Reuters) – Italy’s economy stagnated in the second quarter after marginal growth in the first three months of the year, data showed on Wednesday, as neither trade flows nor domestic demand made any positive contribution.

Gross domestic product was unchanged between April and June both on a quarter-on-quarter and a year-on-year basis, national statistics bureau ISTAT reported.

That still beat the average forecast of a 0.1% fall quarter-on-quarter, down 0.2% year-on-year in a Reuters survey of 28 analysts.

The euro zone’s third largest economy has been broadly stagnant since the second quarter of last year, maintaining its usual position among the most sluggish performers in the 19 nation currency bloc.

Euro zone average growth came in at 0.2% in the second quarter from the previous three months, Eurostat reported earlier on Wednesday.

The government of the anti-establishment 5-Star Movement and the right-wing League forecasts full-year Italian growth of 0.2% in 2019, following the 0.9% rate posted in 2018.

ISTAT made no revision to the first quarter, when GDP rose 0.1% quarter-on-quarter and was down 0.1% year-on-year.

It gave no numerical breakdown of components with its preliminary second quarter estimate, but said industry and agriculture had contracted, offset by some growth in the service sector.

So-called called “acquired growth” at the end of the second quarter stood at zero. This means if GDP were to be unchanged quarter-on-quarter in the last two quarters, over the whole of 2019 it would also be flat compared with 2018.

(((Gavin Jones, +39 06 8522 4232, fax +39 06 854 0568; rome.newsroom@news.reuters.com)))

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