Italy Suffers Recession Alone in Economic, Political Isolation

Italy’s recession at the end of 2018 was almost unprecedented among the euro area’s major members and provided further evidence of the self-inflicted damage to the economy.

While mighty Germany only barely avoided the same fate, its weakness was largely due to one-time effects in the car industry. Italy’s two straight quarterly contractions highlight deeper issues; they also mean it’s the region’s only major economy to slip into recession alone. That amounts to a dubious distinction, as shown in the chart below.