Italy's gross domestic product (GDP) contracted by 0.9 per cent from October to December compared to the previous quarter, a far bigger contraction than had been expected, official figures showed Thursday. UniCredit, Italy's leading banking group, had forecast a 0.4-per-cent quarterly fall, albeit "with downside risks." Britain's Barclays had expected a 0.6-per-cent loss in output, also with downside risks.
Compared to the last quarter of 2011, the economy shrank by 2.7 per cent, Italian national statistics office Istat said. The contraction for the 2012 calendar year was -2.2 per cent, it added. Italy's GDP has been shrinking for six consecutive quarters - one of the deepest recession in its postwar history. The economy is expected to pick up again towards the end of the year.
The gloomy figures are likely to weigh on the campaign for general elections due in February 24-25. Outgoing premier Mario Monti is defending himself from charges of having depressed the economy with excessive rounds of austerity.