The 27 member states of the EU have been at odds over new debt rules for several months.
"Higher perceived risk of a return to old, stringent fiscal rules forcing a faster deficit reduction would worsen medium-term growth expectations for the EU, weighing on the euro.
The old rulesEuropean member states have had to comply with fiscal rules that require they respect a 60% debt-to-GDP threshold and a public deficit of 3%.
In 2020, the fiscal rulebook was frozen so member states could deviate from their fiscal targets and spend on pandemic-related matters, such as protecting jobs.
And with Russia's invasion of Ukraine in 2022, the fiscal rules were kept on hold because governments were faced with new energy costs and inflationary pressures.
Persons:
Giorgia Meloni, Antonio Masiello, Davide Oneglia, Oneglia, Goldman Sachs
Organizations:
Italian, Getty, European Union, Lombard, Goldman, European Commission
Locations:
Italy, Ukraine