Construction output in Italy fell by 0.6% year-on-year in December 2024, reversing a downwardly revised 3.3% increase in November and marking the first contraction in four months.
Italy construction output falls in December
The decline was primarily driven by weaker demand for residential and commercial construction projects, as higher borrowing costs and economic uncertainty weighed on investment decisions.
Monthly change
On a month-on-month basis, construction activity contracted by 1.7% in December after seasonal adjustments, reflecting a slowdown in both private and public sector projects. The decline coincided with broader economic headwinds, including persistent inflationary pressures, rising financing costs, and delays in infrastructure spending.
Output grew in the entire year
Despite the year-end slowdown, construction output for the whole of 2024 remained 5% higher compared to 2023, supported by strong activity in the first half of the year, government incentives for energy-efficient renovations, and ongoing infrastructure projects. However, industry analysts caution that future growth may be challenged by tighter credit conditions and regulatory uncertainties, which could dampen investment in new developments. Moving into 2025, the sector’s performance will likely depend on the trajectory of interest rates, fiscal support measures, and overall economic stability in Italy and the broader Euro Area.
