for Confcommercio it is a technical recession – Corriere.it

The first quarter of 2023 is set up as a period of slowdown in economic activity. Again in March, the GDP is expected to fall by 0.3% compared to the previous month, while on an annual basis there would be a decrease of 0.2%. what emerges from the conjunctural analysis of Confcommercio in March. Overall, the first quarter of 2023 should end with a 0.3% cyclical contraction, confirming the very limited technical recession, both in terms of intensity and duration (two quarters) . Estimates also point to a drop in food consumption (-3.9%) due to the increase in prices.

Positive signals for inflation

Positive signals are expected in March on the inflationary front, with an acceleration of the recovery process that began in December 2022. Our estimate – states the Confcommercio note – of a zero change in consumer prices on a monthly basis and a growth in 8.1% in the annual comparison, a consequence of the reduction in energy and gas prices. On the other hand, elements of tension remain in the food sector. However, the difficulties of the recovery path of price dynamics should not be overlooked, given that core inflation was on the rise again in February.

Consumption, slight slowdown in February

On the consumption side in February, after the moderate recovery in January, favored by the comparison with a month in which last year the worst wave of Covid was recorded in terms of infections, the Confcommercio Consumption Indicator would have recorded a small reduction compared to February 2022 (-0.1%). As in recent months, this estimate reflects a positive trend in services (+3.7%) and a further reduction in the demand for goods (-1.4%). Within the latter aggregate, both food consumption (-3.9% on a trend basis) and electricity consumption continued to decline, segments for which the acceleration in prices has led to very cautious attitudes on the part of families. The furniture sector (-1.7% on February 2022) and household appliances (-2.3%) remain in a difficult condition. At the same time, the signs of recovery that were registered in January for the automotive and for clothing and footwear seem to be disappearing. The lower dynamism of demand observed in the last part of last year and in these first months of 2023 – underlines Confcommercio – still distances the return of household consumption in volume, calculated in the Icc metric, to pre-Covid-19 levels. In comparison with February 2019, the Icc is, in fact, 8.2% lower. For services, the decrease of 19.3%.