With a Europe-wide election looming, however, there's growing pressure on finance ministers to get a deal done in the coming months.On top of global concerns that higher interest rates will last longer than expected, Rome's budgetary plans for 2024 did not appease the markets.
With a Europe-wide election looming, however, there's growing pressure on finance ministers to get a deal done in the coming months. "With European elections coming up, we see a significant chance that the negotiations on fiscal rules are delayed to the second half of next year," analysts at Goldman Sachs said in a note Monday.European member states have had to comply with fiscal rules that require they respect a 60% debt-to-GDP threshold and a public deficit of 3%. But those rules were often neither complied with nor enforced by the European Commission, which oversees them.
"If there is no agreement on new rules, as seems likely, the existing rules, currently suspended, would kick in . And they are stricter than whatever is being discussed now," Moritz Kraemer, chief economist at LBBW, told CNBC.