Record inflation affects living standards in Italy

Vietnam News Agency correspondent in Rome quoted data released by Italy’s National Statistics Service (ISTAT) showing that retail sales in 2022 in this country increased in value (4.6%) but decreased in quantity (- 0.8%) compared to 2021. This means that the average person in Italy has to pay 4.6% more money for a 0.8% reduction in goods in 2022.

According to ISTAT, retail sales increased in all four quarters of 2022 and in all distributions, to varying degrees. The calculated figures include retail sales of consumer goods such as food, clothing, furniture and electronics, both online and in-store.

On a month-on-month basis, retail sales in December 2022 increased by 3.4% in value but decreased by 4.4% in volume compared to the same period last year. However, compared to the previous month, this number decreased by 0.2% in value and 0.7% in quantity.

Also according to ISTAT data, Italy’s economy has reached 3.9% growth in 2022, higher than most forecasts. However, this growth rate did not keep up with the 8.1% inflation recorded in the same year, the highest level since Italy started using the euro in 1999.

Inflation in Italy peaked in October and November last year when it reached 11.8%, mainly due to high energy prices. Currently, this rate is trending down gradually (11.6% in December 2022 and 10.1% in January 2023), but the core inflation rate in January increased to 6.0% (from level of 5.8% in December), signaling that the pressure on energy prices is not over yet. This will affect short-term growth in Italy and the new government in the country is expected to intervene if gasoline prices rise back above 2 euros a liter. Fuel prices have risen significantly since the government ended cutting excise taxes on fuel earlier this year.