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Italian 2011 GDP Growth Slows To 0.4%

The Italian economic growth eased notably in 2011 as the country slipped into recession during the final three months of the year, the latest figures from the statistical office Istat revealed Friday.

The gross domestic product grew just 0.4 percent last year following a 1.8 percent expansion in 2010. This was almost on line with economists' expectations for a 0.3 percent growth.

Investment declined 1.9 percent during the period, while consumption fell 0.9 percent. On the other hand, a 5.6 percent increase in exports prevented further slowdown in growth.

The statistical office also reported that Italy's budget deficit narrowed more than expected to 3.9 percent of GDP in 2011. Economists expected a decline to 4 percent from 4.6 percent of GDP in 2010.

The primary balance amounted to EUR 15.658 billion or 1 percent of GDP. General government debt reached 120.1 percent of GDP last year.

The statistical office reported earlier this month that Italy slipped into recession during the fourth quarter with the GDP shrinking for a second consecutive quarter. During the October-December period, GDP fell 0.7 percent quarter-on-quarter after 0.2 percent contraction in the third quarter.

Annually, GDP was down 0.5 percent in the fourth quarter, which reversed a 0.3 percent gain in the third quarter.

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