MILAN (AP) -- Italian public debt has swelled to its highest level ever, reaching $2.64 trillion in October. The Bank of Italy on Friday said that the debt pile has risen by 3.7 percent since January 2012. The Italian economy, the third-largest among the 17 European Union countries that use the euro, is in recession as the government has enacted spending cuts and tax hikes to get a handle on its debts. Italy has the second-highest debt level as a percentage of its GDP in the eurozone, behind only Greece.
Italy's borrowing costs have been kept down in recent months, thanks mainly to a European aid program it has the option to tap, despite political uncertainty raised by Silvio Berlusconi's possible return to politics.