🚨 ITALY REAFFIRMS PLAN TO PUSH BUDGET DEFICIT BELOW EU LIMIT ROME, ITALY - Confirmation of the 3.1% deficit changes the European Commission's next decision more than it changes Italy's finances. The fiscal gap missed the threshold by a narrow margin, but that is enough to delay Rome's preferred timetable for leaving the excessive deficit procedure. Italy appears to be betting that credibility now has greater value than short-term fiscal stimulus. Maintaining a path below 3% gives the government stronger grounds to argue that future spending flexibility should come from negotiated exemptions rather than weaker budget discipline. The political calculation is also different from previous years because EU rules have been softened by special provisions linked to defense and energy pressures. That reduces the immediate penalty for remaining under EU scrutiny, while preserving incentives to keep consolidation on track. A sustained return below the ceiling would gradually shift attention away from yearly deficit targets and back toward Italy's far larger challenge: a debt burden that remains among the highest in the euro area. Once markets and EU institutions adjust their expectations to a lower-deficit path, abandoning it becomes much harder to reverse. Writer: Brij