Brussels to examine Italy's fiscal flexibility requests while Dombrovskis warns against more leeway

The European Commission will examine Italy's and Greece's requests for more fiscal flexibility to address inflation more closely, Valdis Dombrovskis said at a press conference after the Eurogroup. He said he had held talks that day with Greek Minister Kyriakos Pierrakakis and Italian Economy Minister Giancarlo Giorgetti to discuss the situation.

We cannot continue to introduce new forms of fiscal flexibility.

Dombrovskis said this could cast doubt on the collective determination to adhere to the fiscal rule framework, and that the credibility of the commitment to public finance sustainability is a crucial asset. A Commission spokesperson said Italy's request to activate the national escape clause, received on 11 September, had been assessed positively, concluding that activation does not effectively put medium-term fiscal sustainability at risk. The file now goes to the Council, which has one month to give final approval. Giorgetti said the Eurogroup had a broad debate on the negative effects of inflation on public accounts, in which the Italian proposal received numerous endorsements beyond the traditional doubts of frugal countries. Dutch Finance Minister Eelco Heinen said he was tired of the discussion, that spending should be cut, and that he opposed energy safeguard clauses. Pierfrancesco Maran, a Democratic Party MEP, put the energy-related flexibility at about 14 billion euros of additional spending capacity.