Italian GDP Unexpectedly Contracts

The Italian gross domestic product contracted by 0.1% from the previous quarter in the three months to June of 2025, trimming the 0.3% expansion from the first quarter and contrasting sharply with market expectations of a 0.1% expansion, according to a preliminary estimate.

It was the first contraction since the second quarter of 2023, pressured by a negative contribution by net foreign demand as tariff threats from the US and volatile commodity prices pressured trade flows.

In the meantime, the GDP expanded by 0.4% from the corresponding period of the previous year.