Public markets are reportedly leading in Italy as private capital activity rebounds in a more selective manner. This, according to an update from the researchers at PitchBook. As stated in the latest report, Italy’s economy faced a mixed Q3, with GDP stagnating and exports “softening” amid persistent trade headwinds while inflation and “fiscal consolidation” remained steady.
The research update from PitchBook also mentioned that public markets stood out, with the FTSE MIB surging “25% YTD, led by banks and industrials.”
The report also stated that private markets were more cautious: Venture capital deal value rebounded, but exits remained somewhat muted, and private equity activity reached a 5-year high in deal count despite “smaller transaction sizes.”
Overall though, Italian investors have balanced optimism “with prudence in an uneven macro landscape.”
PitchBook further noted that during Q3 of this year, Italy’s ongoing recovery has showed clear signs of strain under the “weight of external headwinds and fragile domestic momentum.” Preliminary data suggest GDP “stagnated QoQ, confirming a weak expansion path.”
Industrial output has reportedly declined, and export growth also slowed significantly amid growing trade tensions, especially with non-EU markets.
Inflation remained quite stable, with CPI at “1.6% in September, matching the same rate in five of the nine months YTD.”
Meanwhile, the unemployment rate has edged up “modestly to 6.1%.” On the fiscal side, Rome continued its consolidation efforts: The budget deficit is projected to narrow to “around 3% of GDP in 2025 (from 3.4% in 2024), supported by stronger-than-expected revenue collection.”
The government reportedly remains committed to meeting the European Union’s 3% limit by next year, however, fiscal risks continue to persist. And at the European level, the EU and the US have now agreed on a “uniform 15% tariff on most EU exports to the US,” down significantly from the 20% initially announced on “Liberation Day.”
In conclusion, the report from PitchBook has noted that the European Central Bank cut rates once during the quarter but has since adopted “a wait-and-see approach before considering further easing.”
