Low inflation figures for Italy
on Monday sparked alarm that recovery from the country's longest
recession in decades may not be taking hold.
Annual inflation in Italy was down to 0.3% in June, the
lowest it has been since October 2009, provisional data from
national statistics agency Istat showed.
The Italian small and medium business association
Confesercenti called it a "potentially fatal risk" to the
Italian economy.
"Inflation"s slowdown in June is worse than expected, and
now a scenario of negative inflation appears more realistic,"
explained Confesercenti in a statement decrying high taxes and
continuing credit squeeze on businesses.
The group, which says it 350,000 member businesses, said the
inflation numbers "reflect a domestic demand that is still
extremely weak due to the difficulty of businesses and high
unemployment".
The chief economist for the Italian think tank and
consulting group Nomisma, Sergio De Nardis, called the inflation
data "an alarm bell that continues ring".
"It is not clear whether policy has completely taken this
into account. The ECB (European Central Bank) action, which
begins with the emission of liquidity and will be had in
September, may not be enough," said De Nardis.
"To prevent stagnation or deflation, a more incisive
picture of European stimuli is needed, as much on the monetary
front as on fiscal support for demand," De Nardis explained.
Maurizio Petriccioli, chief of the Catholic trade union
CISL, called for "extraordinary measures" to tackle the "strong
crisis of internal demand and consumption".
Petriccioli demanded that Premier Matteo Renzi's signature
tax cut of 80 euros per month for low earners be extended to the
retired and the handicapped, and that more growth measures to
reward "virtuous" companies be undertaken.
Consumer group Codacons said it was "extremely worried"
over the Istat inflation data.
"In particular, the fall in food prices is absolutely
alarming," said Codacons President Carlo Rienzi.
"Prices fall only when consumers no longer buy, and if they
don"t buy anymore, thousands of small businesses are destined to
close".
Spending on food fell back to levels seen 30 years ago, with
a loss of 3.6 billion euros worth of spending in 2013.
Meanwhile, consumer groups Federconsumi and Adusbef
expressed skepticism, calling Istat"s June inflation numbers
"unlikely".
The groups said Istat's data were too low, and spawn
"doubts about what were the exotic locations where Istat carries
out its surveys".
ALL RIGHTS RESERVED © Copyright ANSA
