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Italy Raises 2013 Budget Deficit Forecast To 0.5%

Italy's government increased the budget deficit forecast for 2013 to 0.5 percent of gross domestic product from 0.1 percent previously.

The Cabinet led by Prime Minister Mario Monti announced in a statement on Wednesday that the structural budget surplus of the country would be 0.6 percent of GDP next year. The primary surplus that excludes the cost of servicing the country's debt is expected to be 3.6 percent this year. It is seen rising to 5.7 percent in 2015.

Following a meeting on Wednesday to approve the a three-year economic plan, the Cabinet said the euro area country's public debt, excluding loans to Greece and contribution to the two Eurozone bailout funds, is expected to total 120.3 percent of GDP this year. The figure is forecast to fall to 110.8 percent in 2015.

The government cut the economic outlook for this year. The economy is now expected to contract 1.2 percent, which is worse than the previous forecast for at least a 0.4 percent shrinkage. Next year, the economy is seen expanding 0.5 percent.

by RTTNews Staff Writer

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