Italy sees slightly less than 1.3pct 2012 contraction

ROME: The Italian government expects the economy will contract slightly less than 1.3 pct in 2012, a junior minister in the economy ministry said on Monday.

Gianfranco Polillo told an Italian television show the government's macro-economic forecasts would be discussed at a cabinet meeting on Monday night and approved on Wednesday.

The government's previous forecast for 2012, made last year, is for the economy to contract by 0.4 percent. But the Bank of Italy has forecast 1.5 percent, the European Commission has forecast 1.3 and Italy's employers lobby Confindustria has forecast -1.6 percent.