ROME, Nov 25) - Confidence among Italian manufacturing firms fell in November to its lowest level since May as inventories built up and output prospects worsened slightly, research group ISAE said on Thursday.
The government funded think tank said its seasonally adjusted business confidence index fell to 90.2 from 91.0 in October and 90.6 in September, though the index is still above its long term average since 1991 of around 88.5.
The fall in Italian business sentiment appears in line with other euro zone leading indicators this month, as the area struggles with slowing global growth and the high euro.
German investor confidence as reported by the ZEW research institute on Nov. 9 slumped to its lowest level in almost two years.
And on Tuesday the November survey of business sentiment published by the Belgian central bank, considered a bellwether for the wider euro zone economy, hit its lowest level since February.
The closely watched German business confidence survey for November, published by the Ifo institute, will be released at 0900 GMT.
ISAE's November survey was weaker than expected. The median forecast in a poll of 17 analysts pointed to an index level of 90.5.
ISAE's business confidence index is a composite of the survey's seasonally adjusted indicators for current inventory levels, current orders, and the outlook for production over the next three to four months.
Current orders remained weak but edged up to -13 from -14 in October, but the production outlook slipped to +15 from +16 and inventories rose sharply to +8 from +5.
Rising inventories are seen as a negative sign for output prospects, suggesting firms will be able to draw on existing stocks to meet demand rather than increase production.