Italy's public debt rises to 2.0895 trillion euros
Up 20.5 billion in January, country under Europe's microscope14 March, 11:02
As a result it put Italy under "specific monitoring" over its "excessive macroeconomic imbalances", which include high debt and poor competitiveness, as part of an in-depth review.
Italy's 2014 budget was passed by ex-premier Enrico Letta. Meanwhile his successor, Matteo Renzi, has unveiled a major package of tax cuts and investments to revive the weak Italian economy, which has received a guarded reception from European Economic and Monetary Affairs Commissioner Olli Rehn.
"It is important to respect the rules of the stability pact, which means balancing the budget in structural terms and being in line with the debt rules," a spokesman said.
In its monthly bulletin, the European Central Bank complained Thursday that Italy has not made "tangible progress" on hitting budget-deficit targets set by the Commission.
Italian government sources said that the ECB's bulletin was scheduled in advance, so the comments on Italy were not a condemnation of Renzi's new measures.
But the conclusions of the report were still hard-hitting.
"In November 2013 the Commission recommended that additional consolidation measures be adopted to ensure compliance with the Stability and Growth Pact (i.e. to achieve the medium-term objective of a balanced structural budget in 2014 and ensure sufficient progress towards compliance with the debt criterion during the transition period)," it read.
"To date, however, no tangible progress has been made with regard to the Commission's recommendation.
"Looking ahead, it is important that the necessary steps are taken to ensure fulfilment of the requirements under the preventive arm of the Stability and Growth Pact, particularly with regard to putting the debt-to-GDP ratio on a downward path, as also recently highlighted by the European Commission in the context of its in-depth review for Italy".