Italy to apply no change to budget, will monitor debt

24 October, 2018, 13:37 | Author: Myra Gill
  • Salvini dismisses Italy's ratings downgrade says outlook'stable

On a visit to Rome, EU Economy Commissioner Pierre Moscovici denied that the commission was already set on issuing an outright rejection of Italy's budget plans, a move that would be unprecedented.

"Tomorrow the Commission will discuss the procedure and will determine the next steps", the spokesman told a news conference.

Markets reacted to Italy's plans by pushing up borrowing costs Friday to the highest levels in five years.

Under EU rules, the Commission has time until October 29 to decide whether to send back the budget to Rome for changes.

Italy's plans have widely been criticized by many EU leaders and the EU Commission chief as being out of line with the bloc's spending constraints.

Deputy Prime Ministers Luigi Di Maio and Matteo Salvini, head of the anti-establishment 5-Star Movement and far-right League respectively, both reiterated Italy's commitment to the single currency.


Italy on Friday suffered a credit rating downgrade, criticism from European Union peers, and market jitters, sparked by its populist government's plans to flout eurozone budget discipline rules.

The government's free-spending plans prompted a credit downgrade by Moody's on Friday, which cut Italy's sovereign debt rating to one notch above junk status.

"I want to say it here, and there will be other solemn occasions to reiterate it as a government and a political party, ... there is no Plan B (to leave Europe) but only Plan A which is to change Europe", Di Maio said.

Di Maio said he hoped the Commission would take into account Italy's strengths such as the private sector's low debt and high household wealth, which Moody's cited among reasons supporting a "stable" outlook on the rating. The Commission believes that the place of Italy in the heart of Europe, in the centre of the Euro zone, not outside of them.

Mr Conte also vowed that his country would remain in the European Union and would stick by the euro, saying: "Read my lips; for Italy there is no chance of Italexit, to get out of Europe or the eurozone".

He said the 5-Star, founded by comedian Beppe Grillo, was working to present in January-February a programme that brought together similar grassroots movements from other European countries with the goal to "give back a heart and humanity to European institutions".

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