Italian households got poorer over the course of last year while state institutions reduced their levels of indebtedness, official figures released Wednesday showed.
The outgoing government of prime minister Mario Monti has introduced tough austerity measures to deal with a financial crisis in the eurozone's third-largest economy.
Households' purchasing power fell by 4.1 per cent in the first nine months of 2012, national statistics office Istat said.
Over the same period, net public borrowing fell to 3.7 per cent of gross domestic product, down from 4.2 per cent in the first nine months of 2011.
A 1.4-per-cent increase in public expenditure was more than matched by a 2.7-per-cent rise in revenues, Istat said.