Italian GDP contracts more-than-expected in Q3

Forexpros – Official data on Wednesday showed that Italy’s economy shrank more-than-expected in the third quarter, underlining fears over the fiscal health of the euro zone’s third largest economy.

In a report, ISTAT, Italy’s statistical office said the country’s gross domestic product contracted by a seasonally adjusted 0.2% in the third quarter, worse than expectations for a 0.1% contraction.  

It was the first contraction since the final three months of 2009. Italy’s economy expanded by an unrevised 0.3% in the preceding quarter.

Annualized GDP rose at a rate of 0.2%, below expectations for a gain of 0.4%, after rising at a rate of 0.7% in the second quarter.

Following the release of the data, the euro held on to gains against the U.S. dollar, with EUR/USD rising 0.45% to trade at 1.3141.

Meanwhile, European stock markets were broadly higher. Italy’s FTSE MIB 40 climbed 0.85%, the EURO STOXX 50 advanced 0.9%, France’s CAC 40 rose 0.85%, Germany's DAX jumped 0.9%, while the FTSE 100 added 0.55%.