Video PlayerClose

ROME, July 14 (Xinhua) -- The Bank of Italy revised its 2017 gross domestic product (GDP) forecast upwards, from 0.9 percent to 1.4 percent, the central bank said in its third economic bulletin out Friday.

Italy's economy should grow by 1.3 percent in 2018 and by 1.2 percent the following year, according to the bulletin.

In January, the Bank of Italy estimated GPD growth of 0.9 percent in 2017 and 1.1 percent in 2018 and 2019.

The central bank cited "an acceleration in economic activity at the beginning of the year, as well as more favorable developments in foreign demand and in the market for energy raw materials" as reasons for its positive outlook.

Italian GDP grew an estimated 0.4 percent in the second quarter, as it did in the first quarter, due to favorable trends in the service and industrial sectors, the economic bulletin said.

The employment rate is continuing to expand in spite of the end of government tax incentives to companies that hire on a permanent basis, while credit to families posted "modest" growth, the Bank of Italy said.

Uncertainty linked to financial markets and to "the evolution of global economic and trade policies" could drag these growth projections downwards, the economic bulletin added.

The International Monetary Fund (IMF) in June revised upwards its economic growth forecast for Italy, from 1 percent to 1.3 percent this year.

Also on Friday, the Italian central bank said national debt grew to just over 2.278 trillion euros (just over 2.6 trillion dollars) in May 2017, up from about 2.251 trillion euros in June 2016.

Italy's GDP shrank 7 percent and industrial production plunged 25 per cent during the economic crisis of 2007-12, according to the Bank of Italy.

The country has been experiencing a weak economic recovery ever since.