Italy says EU has to weigh inflation when assessing budget deviations

ROME, Oct 7 (Reuters) - ‌European Union ​authorities ​should take rising inflation into account when assessing government deviation from budget ‌goals, Economy Minister Giancarlo Giorgetti said, arguing ⁠that higher prices can significantly affect governments' fiscal ‌plans.

• Giorgetti said he ‌would raise the issue of greater budget flexibility at this week's meeting of euro zone ​finance ministers.

• "We are not questioning the budget rules, but we are asking that ⁠the rules be adapted to today's reality," he said.

• Italy had ​agreed its spending targets with Brussels assuming annual inflation of 1.8%.

• However, ​Italian inflation jumped to 4.1% ‌in September from 3.2% the month before.

• "We must consider the relevant factors ⁠that in some way influence today's environment," Giorgetti said.

• When assessing whether to open or escalate ⁠an infringment procedure against member states that fail to ​meet agreed spending goals, the EU Commission has to take into account relevant factors such as severe ‌external shocks.

• "The burden of energy costs could (negatively) impact next year's growth by ‌no less than 0.2% of GDP," Giorgetti ⁠said.

• Italy will ‌approve 2027 budget ​next week, he added.

(Reporting by Giuseppe Fonte, edited by Cristina Carlevaro and Nick ‌Zieminski)

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