Italy Responds To EU Commission, Admits Deficit Breach But Refuses To Budge | WHAT REALLY HAPPENED


Italy Responds To EU Commission, Admits Deficit Breach But Refuses To Budge

Initial relief over a favorable Moody's downgrade of Italy, which pushed the rating just one notch above junk but kept the outlook stable (which in turn prompted the following sarcastic remark from Deutsche Bank's Jim Reid "If there’s one thing the outlook isn’t for Italy at the moment it’s stable but rating agencies are unlikely to want to create a vicious circle") faded after Italy’s populist government promised it won’t let its budget deficit widen further than currently planned and called for dialogue with the European Union to address their differences.

In its letter response to the European Commission published Monday and seen by Bloomberg, Italy acknowledged Europe's concerns about the budget, but refused to change the proposed plan.

Finance Minister Giovanni Tria said the government is ready to act to ensure it doesn’t exceed the 2.4% target for 2019, noting that he’s aware that his spending plans don’t comply with EU rules and he wants "constructive" talks with officials in Brussels.

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