Italian economy shrinks by 0.7pc

Italy's recession has deepened with its economy shrinking for the fourth quarter in a row.

Official government statistics released Tuesday show that that the economy contracted by 0.7 percent in the second quarter compared with the previous three months.

Compared with the same period of 2011, the economy shrank by 2.5 percent the worst year-on-year contraction since the fourth quarter of 2009, when the economy shrank by 3.5 percent.

Premier Mario Monti has recently been courting other European leaders seeking some fiscal leeway to allow Italian to grow the economy, rather than sticking to tight budgetary targets that tend to have a recessionary impact. Economic growth is seen as the most effective means of bringing down the nation s high public debt, now at 123 percent of the country s GDP.