The global outlook is affected by uncertainty concerning China
The latest data confirm that the recovery is proceeding in the euro area but China’s path of adjustment from its high levels of investment and debt is a risk for the world economy. The Governing Council of the ECB stands ready to adjust the size, composition and duration of the asset purchase programme, if this proves necessary to combat the downside risks.
In Italy the main indicators confirm the cyclical upturn
In Italy the latest cyclical indicators suggest that the expansion continued in the third quarter at about the same pace as in the first half of the year. The strengthening of the recovery in private consumption and the gradual revival of investment in productive capital are contributing factors. Employment has made significant gains as a consequence of the cyclical recovery, as well as of the Government’s measures for social contribution relief and labour market reform.
Credit conditions gradually improve
The improvement in the credit market continues, fostered by the cyclical upturn and the measures adopted by the ECB Governing Council. The brightening macroeconomic picture has had a positive effect on the flow of new non-performing loans. The Italian Parliament has approved measures to remove some of the causes of the still substantial overhang of bad debt and encourage the establishment of a secondary market in impaired assets.
