Italy economy shrinks more than previous forecast

Italy’s economy has contracted more than initially estimated in the first quarter of 2013, marking the seventh quarterly contraction in a row, the country’s statistical agency says.

Figures from the national statistical agency, Istat, showed on Monday that Italy’s gross domestic product (GDP) shrank by 0.6 percent in the first three months of this year and by 2.4 percent on an annual basis.

Istat had estimated a fall of 0.5 percent in GDP for the first quarter and 2.3 percent for the year in its preliminary forecast on May 15.

The figures showed that all the drivers of demand, including internal consumption, fixed investment and exports fell in the first quarter.

On May 31, Istat’s figures showed that the jobless rate for people between the age of 15 and 24 rose to 40.5 percent in April, the highest since the institute started collecting data on Italy in 1977.

Joblessness soared to 12 percent in April after the March reading was revised to 11.9 percent from an initial 11.5 percent, Istat said.

Italy started to experience recession after its economy contracted by 0.2 percent in the third quarter of 2011 and by 0.7 percent in the fourth quarter of the same year.

Over the past decade, Italy has had the slowest growing economy in the eurozone.

Italians have been staging protests against high unemployment, economic adversity, and hardship over a series of government-imposed austerity packages in the recent years.

The government says the reforms are needed to create jobs, increase competition, and cut costs in the economy.