Italy: historical record in producer prices. We are moving towards deindustrialisation
The real problems to be faced are starting to present themselves: industrial producer prices in Italy increased by 40.1% on an annual basis in August 2022, an all-time high, after 36.9% the previous month. Costs accelerated on the domestic market (50.5% against 45.9% in July) but slowed down on the foreign market (12.5% against 12.8%), where it is more difficult to increase margins. The most consistent increases were recorded for the costs of energy (126.8%) , intermediate goods (17.8%), consumer goods (9.5%) and capital goods (9.1%) . On a monthly basis, producer prices rose 2.8%, down from the 5% jump recorded in July.
here is a short chart:
And one with a 25-year horizon, which shows the exceptional nature of the current situation
After years of forced deflation, we are now unable to contain energy inflation. With these levels our productions are no longer competitive with foreign countries and in the end we will see a colossal process of competitive displacement, that is, a rapid and painful deindustrialization with a corollary of non-EU relocations, if all goes well, and bankruptcies, if it goes badly. .
These are the real problems that the future government will face, and for which it must be ready as people, but also as ideas. Because the solution to the energy problem will certainly not be easy, and, perhaps, there will be a need to upset some established rules.
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The article Italy: historical record in producer prices. The move towards deindustrialisation comes from ScenariEconomici.it .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/italia-record-storico-nei-prezzi-alla-produzione-si-va-verso-la-deindustrializzazione/ on Thu, 29 Sep 2022 12:05:53 +0000.