Keywords: Consumer confidence; Business confidence; consumer sentiment; Index of Consumer Sentiment; credit crunch
This paper proposes an analysis of consumer and business sentiment in Italy in the period 2002-2008. The analysis is based on Cati quantitative surveys conducted every three months on representative samples of the two populations (Italian consumers and businesses). This analysis shows that consumer and business sentiment reached a record low at the end of 2008. In the case of consumers this fall does not seem attributable to the credit crunch (September 2008). On the contrary, since the fall dates back to at least one year before, it appears linked to uncertainty regarding job security, economic fundamentals (i.e. salaries, taxes and business growth) and rising prices. However, consumers and businesses appear able to cope with these contextual constraints and they show a certain degree of renewed willingness to consume and invest in the immediate future. The paper discusses the results from both a short- and long-term economic perspective.