European Commission accuses nine eurozone countries of violating fiscal rules

Bloomberg reports that one-third of European Union countries, representing about half of the bloc's population, are in violation of its fiscal rules, with Austria being the latest to join the list.

On Wednesday, the European Commission identified nine countries, including France, Italy, and Austria, that have exceeded the 3% budget deficit-to-GDP limit. These nations will now face stricter scrutiny from Brussels under the excessive deficit procedure and could be subject to fines if they fail to meet fiscal requirements. According to Bloomberg, these developments highlight the fiscal strain in the eurozone, which is exacerbated by rising defense spending, weak economic growth, and an aging population.

Austria's inclusion is particularly notable, as the country is facing a third year of recession after its deficit reached 4.7%. The finance minister plans to meet the EU's 3% target only by 2028.

Meanwhile, France's budget deficit is projected to be 5.4% this year, with a target of reaching 3% by 2029. Although Italy remains on the list, its deficit is expected to fall below the EU ceiling next year, the agency reports.