ROME: Italian business morale was weaker than expected in January, falling to its lowest level since November 2009 on a deteriorating production outlook, data showed on Monday.
The data is the latest indication that Italy is mired in a recession which is forecast to intensify through 2012, as it grapples with a debt crisis that threatens the whole euro zone.
National statistics office ISTAT's seasonally adjusted business confidence index decreased to 92.1 in January, lower than expected, from an unrevised 92.5 in December.
A Reuters survey of analysts had pointed to 92.8 in January. Forecasts spanned 92.0 and 93.5.
The decline mirrored a drop in French business morale in January while German business sentiment rose for the third month in a row, adding to evidence that Europe's largest economy is shrugging off the euro zone debt crisis.
The fall in ISTAT's headline index was due to a weaker production outlook while order levels improved slightly and inventories were lower.
The Italian economy, one of the most sluggish in the euro zone for more than a decade, posted a 0.2 percent decline in gross domestic product in the third quarter of 2011 and anal ysts expect GDP to continue falling for most of 2012.
The consensus forecast in a Reuters poll of analysts published this month pointed to a GDP contraction of 1.2 percent in Italy this year, compared to the government's forecast of a 0.4 percent decline.
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