Italy’s economy shrank in the third quarter of the year to put the country on the path of what is expected to be a long period of stagnation due to heavy debt burdens that required strict austerity measures. The GDP fell in Italy’s third largest economy in the euro area because of falling domestic demand. The data was weaker than expected and indicate that the economy is facing great difficulties even before the strict austerity measures adopted in previous months in a bid to rein in borrowing costs high. And Italian bond yields rose in the months prior to exceeding 7%, a level seen as widely as it can not afford. The revenue amounted to 6.7% from the first Wednesday.
Said Raj Badiagn any. H. S Global Insight, which is expected contraction of GDP for Italy, 1.5% in 2012, that there is a flow of weak economic data and financial contagion severe debt crisis, the euro zone has hurt Italy, foreshadowing recession severe long-term is expected to continue until the fourth quarter of 2012. This will make the task of the new Italian Prime Minister Mario Monti more difficult. Monte and display earlier this month of masterminding a proposed 34 billion euros through tax increases and spending cuts, and said that Italy needs to the third austerity package since the summer due to the deteriorating growth prospects.