ROME, Oct 25 (Reuters) - Italian business confidence fell in October from September, largely as a result of weakness in the auto manufacturing sector with Fiat on the ropes, economic research institute ISAE said on Friday.
The government-funded think-tank said its business confidence index fell to a seasonally adjusted 95.3, from a downwardly revised 95.8 in September. The September figure had been previously reported at 96.1.
"It is likely that, among other things, the announcement of the serious crisis in the auto sector is the main cause of the strong increase in pessimism regarding short-term economic prospects," ISAE said in a statement.
ISAE said that stripping out the auto sector, the business confidence index had actually risen in October.
In September, business confidence had risen for the first time since May on short-term expectations.
Fiat, Italy's largest private sector employer, announced plans earlier this month to lay off more than 8,000 workers, or more than 20 percent of its Italian autoworkers, as it struggles to cut costs and claw back falling market share.