Italian economy contracts for 4th straight quarter

FILE – In this July 4, 2012 file photo Italian Premier Mario Monti gestures as he speaks during a joint press conference with German Chancellor Angela Merkel, unseen, during a bilateral meeting at Villa Madama in Rome. German news magazine Der Spiegel on Sunday, Aug. 5, 2012, quoted Monti as saying in an interview that “the tensions accompanying the eurozone over the past years already bear the signs of a psychological dissolution of Europe.” He further told the magazine that the euro’s disintegration would “destroy the founding of the European project.” (AP Photo/Riccardo De Luca)

MILAN – Italy’s recession has deepened with its economy shrinking for the fourth quarter in a row.

Official government statistics released Tuesday show that that the economy contracted by 0.7 per cent in the second quarter compared with the previous three months.

Compared with the same period of 2011, the economy shrank by 2.5 per cent — the worst year-on-year contraction since the fourth quarter of 2009, when the economy shrank by 3.5 per cent.

Premier Mario Monti has recently been courting other European leaders seeking some fiscal leeway to allow Italian to grow the economy, rather than sticking to tight budgetary targets that tend to have a recessionary impact. Economic growth is seen as the most effective means of bringing down the nation’s high public debt, now at 123 per cent of the country’s GDP. (thecanadianpress.com)

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