Reuters reports citing two government sources
- Says there are "excellent chances" that EU won't discipline Italy if Rome agrees to deficit target of 2.0%
- However, also says that neither coalition party i.e. Salvini and Di Maio wants to lower the deficit target to below 2.2%
As mentioned earlier, it's unlikely that Conte will be able to successfully persuade Salvini and Di Maio to agree towards a 2.0% deficit target. Even more so after what happened in France where Macron promised to raise the minimum wage and abolishing a tax on pensions.
If anything, what is happening in France will only embolden the populist government in Italy as they will defer to accusations of preferential treatment on the budget. As it stands, Italy's current proposal is a deficit target of 2.4% - still below the European Commission's threshold of 3.0% - but Macron's latest promises is reported to push France's deficit to almost 3.5%.
