FAZIO: REAL PRICES HIGHER THAN THOSE QUOTED BY ISTAT; EURO TO BLAME

Today in Italy - Special service by AGI on behalf of the Italian Prime Minister's office

(AGI) - Agrigento, Italy, Jan. 25 - The adoption of the euro has had an effect on Italian consumer trends and real inflation, that which is felt by consumers, "is decidedly higher" than that quoted by Istat, whose survey system is "rigorous" but "traditional." Bank of Italy Governor, Antonio Fazio, speaking from the stage at Agrigento, where he gave his traditional speech at the Forex convention, has once again turned his attention to price increases - and it appears that he gives credit to the complaints put forward by consumers, who over the last few weeks have created much controversy over official statistics concerning inflation. "The change to the single European currency has weighed on consumer trends," he said. "Empirical analysis - he added referring to the elaborations carried out based upon the Bank of Italy's econometric model carried out together with ISAE on Istat data - shows that the inflation felt by consumers is decidedly higher than that which emerges from the traditional and rigorous methods used by Istat." Fazio explains that "the increase in consumer prices between the end of 2001 and the end of last year was equal to 2.8 percent and the effect of the rounding up of prices is assessable to a little more than 0.5 percent." The price of general food goods weighed most heavily on the bread basket where "price increases measured by official indexes is above or is a little below 10 percent." "Decreases on the other hand were registered for consumer durables." (AGI)

251458 GEN 03 COPYRIGHTS 2002-2003 AGI S.p.A.