Industrial production failed to recover much ground in February. A 0.1 percent monthly rise was well short of the market consensus and followed a steeper revised 1.4 percent drop in January. Positive base effects were largely responsible for an increase in annual workday adjusted growth from minus 3.7 percent to minus 3.1 percent but the rate has now been sub-zero for some 13 consecutive months.

Weakness was most apparent in energy where output fell a monthly 2.0 percent but consumer goods (minus 0.8 percent) also struggled. Offsets came from intermediates (0.1 percent) and, in particular, capital goods (3.5 percent).

On Tuesday the government revised down its 2024 growth forecast from 1.2 percent to 1.0 percent and today's disappointingly soft data are certainly consistent with a poor first quarter. Ignoring any revisions, March will now need a monthly increase of at least 3.3 percent if the sector is not to have a fourth straight hit on GDP growth. The February report trims both the Italian RPI and RPI-P to minus 25, underscoring the underperformance of overall economic activity versus market expectations.

Production in February is expected to rise 0.5 percent on the month following an unexpectedly weak 1.2 percent decline in January.

Industrial production measures the physical output of the nation's factories, mines and utilities. Construction is excluded. Approximately 4,100 companies provide data on more than 8,000 monthly flows of production.

Investors want to keep their finger on the pulse of the economy because it usually dictates how various types of investments will perform. The stock market likes to see healthy economic growth because that translates to higher corporate profits. The bond market prefers more subdued growth that will not lead to inflationary pressures. By tracking economic data such as industrial production, investors will know what the economic backdrop is for these markets and their portfolios. Like the PPI and the orders data, construction is excluded from the data. This report has a big influence on market behavior. In any given month, one can see whether capital goods or consumer goods are growing more rapidly. Are manufacturers still producing construction supplies and other materials? This detailed report shows which sectors of the economy are growing and which are not.