Italy sees boost in growth, drop in joblessness

Italy enjoyed a boost to its economy in the second quarter as well as a welcome drop in the unemployment rate, official data showed Tuesday, sparking hope that the years of recession may finally be over.

The National Statistics Institute (ISTAT) revised up the growth rate in the second quarter from 0.2 percent to 0.3 percent, while the jobless rate dropped to 12 percent in July from 12.5 percent in June.

The first quarter growth rate was revised higher from 0.3 percent to 0.4 percent, which was Italy's first positive quarter after three years of recession and the highest rate since 2011.

"The economy is growing, unemployment is dropping... Now we need to consolidate and accelerate but we're going in the right direction," Economic Minister Pier Carlo Padoan said on Twitter.

Prime Minister Matteo Renzi's government has forecast an annual increase in GDP for 2015 of 0.7 percent.

"Italy is starting to reap the first rewards of the Renzi labour market reforms," said Berenberg analyst Holger Schmieding.

The head of Italy's business association Confindustria, Giorgio Squinzi, however warned that "while they are certainly positive figures... growth of 0.3 percent is not enough".

Italy has struggled to pull out of its longest postwar recession, after the economy contracted following the financial crisis.