France, Italy Among EU Nations to Be Reprimanded Over Deficits

(Bloomberg) -- France and Italy will be among seven countries that will face a European Union infringement procedure for their excessive deficits last year, according to a person familiar with the matter.

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The EU’s executive arm — the European Commission — will on Wednesday announce the reprimands, said the person who declined to be identified because the plans are confidential. Spain and three other countries whose shortfalls exceeded 3% in 2023 aren’t on the list.

Italy and Poland had already said they were expecting to be admonished for breaching EU rules that include measures for nations with debt higher than 60% of gross domestic product and a budget deficit of more than 3%. Brussels then issues recommendations for bringing the shortfall under control.

Countries experienced a reprieve from the EU’s fiscal rules in the past years as they were suspended to allow spending leeway during the pandemic and energy crisis.

For France, the announcement couldn’t come at a worse time. Macron last week called snap elections, a move that spooked markets as it opens the door to a far-right government, or at least a fractious parliament that could struggle to pass economic and fiscal legislation.

(Updates with France election in final paragraph)

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