Lower public spending is set to curb eurozone economic growth next year as the bloc moves into an era of budget restraint, putting pressure on rate-setters to loosen monetary policy, according to economists.
EU finance ministers this week agreed to new fiscal rules that replace strict but hard to enforce budget constraints that have been suspended since the pandemic hit in 2020.
The measures will phase in tighter spending curbs, forcing high-debt countries to lay out plans to decrease debt, deficit and set a ceiling on annual expenditure, agreed with Brussels.
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