Meloni Faces Worsening 2023 Italy Budget Deficit Around 5% (2)

Giorgia Meloni’s government is confronting drastically worsening budget figures, adding pressure to her options on how to bolster finances.

A much larger 2023 shortfall close to 5% of output — as measured on an underlying basis without one-off factors from accounting revisions — is inevitable given weakened economic growth and electoral promises including tax cuts, according to people familiar with the matter, who declined to be identified because the numbers are still being discussed. The prior target was 4.5%.

Lower than expected growth and the cost of some electoral promises is set to also affect next year’s deficit forecast, ...