Italy industrial output ends three-month positive streak with May fall

ROME, July 10 (Reuters) - ‌Italian industrial output ​fell ​by more than expected in May, with a 0.3% month-on-month drop, official data showed on ‌Friday, in a renewed sign of weakness for ⁠manufacturing in the euro zone's third-largest economy.

A Reuters survey of nine ‌analysts had pointed to a ‌0.2% month-on-month decline in May, after three consecutive increases.

In the March-to-May period, however, output was up 0.9% compared ​to the previous three months, national statistics agency ISTAT said.

"Resilience in the sector has been broadly confirmed," ⁠ING's senior economist Paolo Pizzoli said.

"Industry will likely remain a growth driver in ​the second quarter" when GDP could expand marginally following a 0.3% quarter-on-quarter increase in the ​January-to-March period, he added.

On a work ‌day-adjusted year-on-year basis, industrial output rose 1.1% in May versus a forecast of a ⁠1.3% increase, following a 1.1% rise in April.

Looking ahead, the outlook is clouded by continuing turmoil in the Middle East.

Bologna-based think ⁠tank Prometeia said Italian industrial output was likely to stagnate in ​the coming months, as the effect of the build-up in orders and stock levels fades.

The government in April cut its economic growth ‌outlook to 0.6% for this year and next, reflecting the increase in energy costs ‌and geopolitical tensions, from previous targets of 0.7% and 0.8% ⁠respectively

In 2025 Italy grew ‌by 0.5%, a ​third straight year of sub-1% growth.

(Reporting by Antonella Cinelli, graphic by Stefano Bernabei, editing by Alvise ‌Armellini)

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