Economic developments in PiemonteUpdate

After the relatively sustained growth of 2006, the economic situation in Piedmont remained positive in the first nine months of 2007, despite some signs of a slowdown. Demand grew in almost every sector except textiles, which is still undermined by structural difficulties. Car sales by the Fiat Group continued to expand, although at a slower pace than in 2006. At the same time there was a further slight increase in market share both in Italy and in the other European countries. The growth of production and higher capacity utilization rate were accompanied by an increase in fixed investment spending, in line with firms’ plans at the beginning of the year. However, the export growth rate declined, remaining below the national average. Economic forecasts for the coming months based on the Bank of Italy’s survey and other available information are, on the whole, positive. By contrast, in the construction industry, the economic situation remains weaker, particularly in the public works sector. Employment has increased further, mainly thanks to the remarkable growth in the industry sector. Lending to the corporate sector slowed, partly due to extraordinary financial operations. Interest rates continued to rise following the increase in the official rate. Loans to consumer households grew at a slower pace, especially in the mortgage sector. The ratio of new bad debts to total loans remained unchanged