A sensational turnaround, finally, for our pockets (but not for everyone). Salaries are rising, prices rise less. But the forecasts of families and businesses, despite all this, are not as positive. And there’s a caveat: this cannot last. An economic report from Istat says so. Let’s look at the salient aspects.
The document is the note on the performance of the Italian economy released by Istat which examines the first quarter of 2024. In this period, lAnd contractual hourly wages grew by 2.8% compared to the first quarter of 2023, a higher value compared to the growth in consumer prices (which recorded +1.0% in the same period), “confirming the trend reversal already observed in the last three months of 2023” notes the Istat. “It is confirmed – continues the note -, in the private sector, a much higher dynamic in industry (+4.7%) compared to services (+2.3%). The share of employees awaiting renewal in the private sector (contractual tension index) fell to 16.7% in March (it was around 40% for the whole of 2023 and until February 2024). Based on information available at the end of March, on average this year, salary growth in the private sector would be above 3.0% both in industry and in services and, given the probable absence of renewals in the public sector, it would be equal to 2.4% for the economy as a whole”.
As for prices, the dynamics of the consumer price index for the entire community (NIC), in the first four months of 2024, it fluctuated around 1.0% (+0.9% in April, according to provisional data). The decline in the energy goods component continued (-12.0% in April) and food goods (+2.6% in April, from +5.6% in January).
In the meantime, however, “the results of surveys on consumer and business sentiment show a worsening in April. After the recovery in March, business confidence marked a widespread decline across all sectors and consumer confidence, confirming the decline in March, reached the lowest value since November 2023.”
A situation therefore in chiaroscuro: on the one hand the reversal of trend and on the other pessimism. Maybe justified, because Istat itself warns: this greater growth in wages – which is however a sign of a possible increase in inflation, even though growth in Italy is lower than the EU area average – compared to prices could last very little.
The note explains that “sBased on a model-based approach to decomposing price dynamics, the disinflation process observed since the spring of 2023 was mainly driven by goods with prices whose variations are persistent, such as household goods and services and transport services private. However, the medium-term reduction trend in the prices of goods and services could be subject to temporary interruptionsdue to the contribution of the prices of goods with non-persistent variations, including transport, education, health and cultural services”.
. This is why the current situation will not last – Turin News){kind=link}