August 29, 2014 / 3:25 PM / 3 years ago

Italy's ISTAT sees zero growth in Q3, deflation to deepen

ROME, Aug 29 (Reuters) - Italy’s recession-hit economy is unlikely to return to growth in the third quarter while deflation is set to deepen over the next few months, national statistics office ISTAT said in its latest monthly report on Friday.

ISTAT said data suggested that the economy, which fell into recession with a contraction of 0.2 percent in the second quarter, would “continue in its phase of stagnation for the third quarter of 2014.”

It estimated zero growth in the third quarter, with a forecast range of between -0.2 percent and +0.2 percent.

ISTAT also said that consumer prices, which fell on an annual basis for the first time in more than 50 years in August, would continue to decline in the coming months before picking up towards the end of the year. (Reporting by James Mackenzie)

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