My finance view

Consumer confidence in Italy unexpectedly rose in November after the economy emerged from its worst recession since World War II.

The Isae Institute’s consumer confidence index climbed to 112.8 from 111.7 in October, the Rome-based research center Isae said today in an e-mailed statement. Economists had forecast a drop to 111.5 for this month, the median of 13 estimates in a Bloomberg News survey showed.

“There is a widespread perception that the crisis is over and this is an encouraging sign,” said Luigi Speranza, an economist at BNP Paribas in London. “However, consumers are still cautious about the purchase of durable goods and the outlook for t employment, leaving a question mark on consumer spending in the months ahead.”

Italy’s economy emerged from its fourth recession since 2001 in the third quarter as the recovery in Europe boosted exports, and growth may accelerate to more than 1 percent in 2010, Finance Minister Giulio Tremonti said yesterday. Government stimulus measures, particularly car trade-in incentives, helped buffer the drop in consumer spending and benefited Fiat Spa, the country’s biggest manufacturer.

Those incentives are due to be phased out and unemployment is still rising, which may weigh on confidence in the coming months. The jobless rate may exceed 8 pay day advance.5 percent in 2010 from 7.4 percent in the second quarter, the Paris-based Organization for Economic Cooperation and Development said last week.

Holiday Spending

Those job concerns may slow consumer spending during the holiday season, hurting reatailers such as department story operator Coin SpA. A third of Italians say they will not buy planned Christmas presents this year, according to a survey released yesterday by retailers lobby Confcommercio. More than 11 percent said they still don’t know whether they will spend as much as last year on gifts, Confcommercio said.

“The pace of job destruction in Italy has started to slow,” Marco Valli, chief economist at UniCredit Mib in Milan, said on Nov. 23. “However, given the huge amount of slack in the labor market, genuine employment growth is a matter of 2011 at the earliest.”

Italian optimism contrasts with the mood in Germany. Consumer confidence in Europe’s biggest economy unexpectedly fell in November for a second month as households grew concerned about job security, a separate report said today.

Isae conducted its confidence survey between Nov. 2 and Nov. 17.

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