Italy's Economic Indicators Show Mixed Performance in September

Business Sentiment and Industrial Activity

Italy's overall business confidence climate, as measured by the Istat Economic Sentiment Indicator (IESI), registered a marginal increase in September 2025, rising to 93.7 from 93.6 in August. Within the manufacturing sector, confidence remained stable at 87.3. While firms reported improved order book levels, expectations for future production showed a slight weakening. The construction sector saw a modest rise in confidence, moving from 101.3 to 101.5, and market services sentiment also edged up from 95.1 to 95.6. Conversely, retail trade confidence experienced a decline, falling from 102.7 to 101.6, indicating varied performance across different business segments.

Industrial sales in Italy demonstrated a significant rebound in September 2025. On a year-on-year basis, sales surged by 3.4%, a stark contrast to the -0.1% recorded in the previous year. Month-on-month, industrial sales increased by 2.1%, recovering from a 0.7% decrease in August. This growth was observed in both domestic sales, which rose by 1.5%, and foreign sales, which saw a 3.1% increase. Key industrial groupings such as capital goods (up 5.3%), intermediate goods (up 2.0%), and consumer goods (up 0.6%) contributed positively to this rebound, although energy sales experienced a decline of -5.3%.

Consumer Outlook and Financial Markets

Consumer confidence in Italy showed an improvement in September 2025, with the index rising to 96.8 from 96.2 in August. This increase was supported by improvements in various components: the economic climate index rose from 97.0 to 98.8, the current climate from 99.2 to 99.9, and the future climate from 92.2 to 92.6. The personal climate component remained largely stable at 96.0. Despite these gains, the overall consumer confidence index remained below the 100-point threshold, which typically signifies a pessimistic outlook among consumers.

In the financial markets, Italy's 10-year government bond yield held near 3.57% in September 2025. This level was close to its highest point since early September, reflecting the broader market conditions and investor sentiment during the month. The performance of government bond yields, alongside the mixed confidence indicators and robust industrial sales, painted a complex economic picture for Italy in September.