ROME, July 29 (Xinhua) -- Italy's economy grew 4.6 percent in the second quarter of this year (Q2) compared to the same period a year ago, the government's statistics body reported Friday. However, that figure was dampened by a significant increase in prices, said Italy's National Statistics Institute (ISTAT).
Nevertheless, the 4.6 percent economic growth in Q2 (April-June) was stronger than previous year-on-year growth estimates of 4.3 percent for the period.
Compared to the first quarter of the year, the economy grew 1.0 percent, ISTAT said.
The positive growth rate for Q2 marks the sixth consecutive quarter in which the economy has shown positive growth, starting with the first quarter of 2021 when the economy began to emerge from the economic shadow cast by the coronavirus pandemic.
Meanwhile, economic growth over the first half of the year was 3.4 percent. This figure is higher than the 2.8-percent estimate for this year as a whole, published last month in ISTAT's 2022-2023 economic outlook.
The growth rate was pushed higher by domestic demand, which compensated for a slight drop in exports to other countries during the second quarter.
However, the positive growth rate was offset by higher prices. ISTAT also reported Friday that prices as measured by a basket of representative goods were 7.9 percent higher in July of this year than in July 2021, slightly lower than the 8.0-percent year-on-year increase from June, although prices in July were still 0.4 percent above June levels.
Higher energy costs are the main driving force behind price rises, ISTAT said. In July, prices of energy goods were 42.9 percent higher than in July 2021, although that increase was lower than the 48.7 percent increase between June 2022 and June 2021. Energy prices began surging earlier this year due to the impact of the conflict between Russia and Ukraine.
Over the first seven months of this year, prices have climbed 6.7 percent compared to the same period last year. This is the highest inflation rate Italy has seen since the creation of the euro currency nearly 24 years ago.
Other economic sectors showed smaller increases: prices for recreational, cultural, and personal care services rose by 4.6 percent in July, while prices for processed food rose 9.6 percent, and transportation costs rose 8.9 percent. All these sectors have been directly impacted by higher fuel prices.
Economists have said that rising prices contribute to economic growth when it is measured by value, as is the case with ISTAT's economic growth measurements, although this also means the buying power of the currency.
Despite the day's mixed economic news, the Italian Stock Exchange gained 2.2 percent Friday, finishing the month 5.1 percent higher. At close on Friday, the exchange's blue chip index was 0.2 percent below its level in late February, when it took a fall after the start of the Ukraine crisis. The index is 18.9 percent lower than at the start of the year. ■
