EU Rejects Italy and Greece Calls for More Fiscal Flexibility

The Commission's refusal signals that the eurozone's fiscal rulebook remains the binding constraint, even as borrowing costs climb — a stance that pushes adjustment onto national budgets rather than collective flexibility. For Italy and Greece, both carrying heavy debt loads, that means the room to cushion the cost-of-living and refinancing squeeze is narrower than their governments hoped. The open question is whether Dombrovskis's promised in-depth study of the proposals yields any softening, or whether market pressure forces a rethink from Rome and Athens instead.