Italian Business Confidence Remains at Lowest Level in Years

Confidence among Italian businesses is stuck at the lowest level in almost two decades as many businesses continue to suffer the consequences of the two-month shutdown and slow reopening of shops and factories.

The economic sentiment index fell to 51.1 in May from 79.5 in March, statistics office Istat said. Measures of consumer and manufacturing confidence both declined.

It‘s not clear if there’s been a stabilization of sentiment in recent weeks as there‘s no April figure for comparison. The statistics office wasn’t able to conduct the survey at the height of the strict lockdown. However, consumers‘ view of the outlook is little changed versus March, suggesting some hopes among households that the government’s measures will help the economy in the second half of the year.

Sentiment measures have stabilized in other countries. Germanys Ifo index of business expectations rose in May after plunging in April. A euro-area measure of economic confidence is due later on Thursday.

Italy is in a particularly difficult situation given its strained public finances and the need to spend billions of euros on stimulus to help workers and companies damaged by lockdowns.

A European Commission aid package unveiled on Wednesday includes up to 82 billion euros ($90 billion) in emergency grants for Italy, and up to 91 billion euros in low-interest loans.

— With assistance by Giovanni Salzano