Italian Economy Turns Corner as PM Letta ResignsIBTimes UK

The Italian economy has made a quarterly gain for the first time in more than two years as Prime Minister Enrico Letta is ousted by his party.

Letta is expected to submit his resignation to the president Giorgio Napolitano.

According to Italy's national statistics institute, Instat, GDP growth in the fourth quarter was 0.1% in three months up to December 2013 in a preliminary report.

On a yearly basis, the Italian economy decreased by 0.8% compared to the fourth quarter of 2012.

Letta's probable successor is party rival Matteo Renzi, the 39-year-old mayor of Florence and new chief of the Democratic Party, Italy's largest political group.

"We are at a crossroads," said Renzi during his nationally televised speech to the party leadership on Thursday. "I'm asking you to take the road less travelled."

Letta's departure will bring to an end a 10-month-old government that has gradually got weaker since its formation in the spring of 2013 and has come under pressure for failing to combat Italy's deep economic problems.

If Renzi is to form a new government, which is expected to focus on speeding up structural reforms to recalibrate Italy's economy, which has trailed some other European countries.

For instance, the French economy grew by 0.3% in the fourth quarter and revised up its third quarter reading to flat growth. France had previously reported a 0.1% contraction; during the whole of 2013 the French economy grew by 0.3%.