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Italy state sector deficit rises in February
March 1, 2013 / 7:42 PM / 5 years ago

Italy state sector deficit rises in February

ROME, March 1 (Reuters) - Italy posted a state sector budget deficit of 12.5 billion euros in February 2013, up from a deficit of 7.973 billion in the same month in 2012, partially because of the underwriting of a state bailout for troubled lender Monte dei Paschi di Siena, the Treasury said on Friday.

The Treasury did not include figures for the cumulative state sector borrowing requirement over the first two months of the year.

The state sector borrowing requirement (SSBR), a measure of the gap between central government spending and income, differs from the broader “general government” accounts, which the European Union Stability and Growth Pact refers to when assessing countries’ deficit performances.

The Tuscan bank Monte dei Paschi received a four billion euro bailout this week after failing to meet tougher capital requirements set by European regulators. This impacted for roughly 2 billion on the Ferbuary borrowing requirement.

Italy’s fiscal deficit fell to 3.0 percent of gross domestic product last year, bang on the European Union’s 3 percent ceiling, data showed on Friday, which may allow Rome to leave the European Commission’s excessive deficit procedure imposing corrective measures on countries that exceed the level.

The SSBR narrowed in 2012 in a year in which the technocrat government of Mario Monti cut spending and raised taxes to reign in the deficit. (Reporting by Naomi O‘Leary; editing by Francesca Landini)

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