Italian public debt has swelled to its highest level ever, reaching €2.014 trillion ($2.64 trillion) in October, The Associated Press reports.

The Bank of Italy on Friday, Dec 14, said that the debt pile has risen by 3.7 percent since January 2012, when it was €1.94 trillion.

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.