ROME, July 10 (Reuters) - Italian industrial output surprised by rising 0.8 percent month-on-month in May, confounding expectations for a small decline and bouncing back from a 2.0 percent slide in April.
Analysts, caught unawares by the figures, said it was likely just a temporary rebound rather than the start of a recovery in the euro zone’s third biggest economy.
But the rise beat expectations for a 0.2 percent fall in output, fuelled by a 1.7 percent surge in energy goods and 0.3 percent rises in both investment and intermediate goods. Consumer goods, on the other hand, slipped 0.6 percent due to weak domestic demand.
“The figure is very much linked to the energy component, so overall I believe we will still see a negative second quarter in industrial production,” said Fabio Fois from Barclays Capital.
“There is no reversal in the economic cycle and so Italy will remain in recession in the second quarter,” he said.
Italy has been in recession since the middle of last year, weighed down by government austerity measures aimed at balancing the state budget.
But the weakness of the economy has become a problem for Prime Minister Mario Monti’s efforts to control Italy’s public finances and fend off a debt crisis.
His technocrat government has forecast gross domestic product will fall 1.2 percent this year, while Bank of Italy governor Ignazio Visco sees a 2 percent fall, and employers’ lobby Confindustria expects a 2.4 percent decline.
The rise in Italy’s output followed a 1.6 percent surge in output in Germany, data showed last week, highlighting the resilience of the euro zone’s largest economy.
By contrast, output in France fell by a sharper than expected 1.9 percent on the month, with both manufacturing and energy output declining.
Germany, France and Italy make up at least two thirds of the euro zone’s economic output. Aggregate output data for the currency bloc will be released on Thursday.
On a work-day adjusted year-on-year basis, Italian output in May was down 6.9 percent, compared to a 9.3 percent decline in April.