Overall business confidence lost further ground in June. At 108.3, the headline index slipped from a marginally weaker revised 108.6 in May to hit its lowest level since last December. This was its second decline since February.

At a sector level, confidence also deteriorated in manufacturing (100.3 after 101.2), posting the lowest reading since January 2021. Elsewhere, retail trade (110.5 after 111.4) similarly posted a loss as did services (103.7 after 104.0), while construction improved (162.5 after 159.4).

At the same time, a sharp improvement in consumer confidence (108.6 after 105.1) easily beat the market consensus and posted the highest reading since February 2022.

Today's mixed update puts the Italian ECDI at 25 and the ECDI-P at 15. Both readings show overall economic activity modestly outperforming market expectations.

The Italian statistics office (Istat) conducts business and consumer confidence surveys over the first fifteen and ten working days of each reference month respectively. These provide information about current and expected developments in key sector variables. The largely qualitative results are synthesized for each survey into a single number that provides an overall measure of sentiment. Business confidence reflects the combined results of separate surveys covering manufacturing, retail, construction and services.

If investors want to know how the business or consumer sectors are performing as they evaluate their investment decisions, they can find timely and in depth information in the latest Istat surveys. Although short-term swings can be erratic, changes in trends in confidence can contain very useful information about a sector’s underlying health well in advance of the release of the official data. Moreover, by including some forward-looking components (e.g. manufacturing orders or consumer buying intentions) the Istat surveys can also provide a potential insight into prospective developments.