The ECB warns that as of today Italy "has not made tangible progress" on the additional fiscal consolidation measures requested by the European Commission in its recommendations. "It is important that the necessary steps are taken", writes the institution in its monthly bulletin, underlining the need to bring the public debt on a reduction trajectory, as requested by the EU in its recent analysis on macroeconomic imbalances.
In Italy, notes the Eurotower, the budget deficit remained at 3% of GDP in 2013, "unchanged from the previous year and slightly higher than the 2,9% target set in the 2013 stability program update According to the Commission's 2014 winter forecast, the deficit-to-GDP ratio is projected to fall to 2,6% in 2014 and 2,2% in 2015”.
However, "the Commission recommendation of November 2013 indicated the need for further consolidation measures to ensure compliance with the Stability and Growth Pact - the ECB continues -, i.e. to achieve the medium-term objective of a structural budget in break-even in 2014 and ensure sufficient progress towards meeting the debt criterion during the transition phase”.
In general, the European Central Bank urges the countries of the euro area to adopt the "further adjustment actions necessary to ensure sustainable public finances: putting the high debt-to-GDP ratios back on a clear downward path: it must remain a priority", because today “there is a risk that an attitude of complacency will be established”.
As always, the ECB reiterates that the economic recovery in the Eurozone will continue "at a moderate pace", as will the decline in unemployment. Finally, in the face of a prolonged period of low inflation, the institute once again reassured its intentions: interest rates in the euro area will remain "at or below current levels" for a long time to come and the Eurotower is “ready to consider all available tools and to take further decisive action if necessary”.
