Premier Giuseppe Conte on Thursday defended his government's budget plans for 2019 and said he was not rattled by criticism of them in Europe. "We expected critical observations," Conte said as he arrived at the EU summit. "But we will sit around a table and explain it because, the more time that passes, the more convinced I am that the budget is wonderful". The League/5-Star Movement (M5S) government has said it will let Italy's deficit rise to 2.4% of GDP next year in an expensive budget aimed at boosting growth.
The European Commission has said this could lead Italy to breach the Stability and Growth Pact and may not give the package the thumbs up. The leaders of other eurozone States have been expressing concern too. "Good bilateral meeting with Giuseppe Conte during the European Council," Dutch Premier Mark Rutte said via Twitter after an an encounter with his Italian counterpart.
"I expressed the Netherlands' concern about the budget plans for 2019.
"Full support for the European Commission to apply the common obligations of the Stability Pact". Austrian Chancellor Sebastian Kurz said that "excessive debts" are "dangerous" not just for the "countries that have accumulated them" but "also for Europe".
The spread between Italian and German 10-year bond yields hit a new five-year high of 327
points by the close Thursday, with a yield of 3.67%. It had last been that high in March 2013. The yield had last been that high in February 2014.
European Economic Affairs Commissioner Pierre Moscovici is set to hand Economy Minister Giovanni Tria a letter of reproach in Rome later Thursday.
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