THE Italian economy has been a laggard for years. In the final quarter of 2013, it registered scant growth of just 0.3 percent at an annual rate, and that was a great improvement. Before that, it had shrunk for nine consecutive quarters. The economy remains smaller than it was 14 years ago. Unemployment has climbed to nearly 13 percent, twice its level in early 2008.
Nonetheless, optimism seems to be growing, both among consumers and investors. The Italian National Statistics Institute this weekreported that overall consumer confidence had risen in April to the highest level since 2010. That increase was held down by a lack of enthusiasm for the current situation, but consumers’ views of the next 12 months have risen rapidly over the last two months and are now higher than at any time since 2002.
What is going on? There may be some enthusiasm for changes proposed by the government to raise domestic demand and increase job creation. Prime Minister Matteo Renzi wants to reduce individual income taxes and raise taxes on income from financial instruments — although he would exempt from those increases the income from Italian government bonds.
But there also is relief that the euro zone crisis seems to have eased. The Italian stock market is up more than 25 percent over the last 12 months, and yields on Italian government bonds have plunged. In April the yield on Italian five-year bonds fell below 2 percent — the lowest since the euro zone was created in 1999.
The new consumer confidence survey found that in April, 44.2 percent of respondents said they expected the economy to be good, or very good, a year from now. That was the highest level of optimism since 1996.
To be sure, 23.8 percent of those surveyed forecast an economy that would be bad, or very bad. In many countries, such a high level of pessimism might be alarming. But in Italy, it is an encouraging figure. Not since 2010, when the country seemed to be pulling out of the recession and the European credit crisis had not yet begun, had that figure been so low.
This week, the government reported that the overall unemployment rate in March was 12.7 percent, unchanged from the previous month. At the same time, the rate for younger workers, 15 to 24 years of age, was 42.7 percent.
That is an astonishing rate, but at least it has slipped a bit in each of the last two months.
The consumer confidence survey showed that pessimism on unemployment remained high, but had declined. Nearly half — 47.5 percent — of the respondents expected unemployment to rise over the next year, but it was the first monthly survey since 2008 in which the figure was not over 50 percent.
The proportion expecting unemployment to decline was just 21.6 percent, but that figure was higher than at any time since 2002. The remaining respondents either had no opinion or expected the rate to remain stable.
In most countries, a survey that showed there were more than twice as many pessimists as optimists on future unemployment would not be viewed as a good sign.
But in Italy, that is a big improvement.