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Spain Says Fiscal Rigor Isn't Sacred in Raising Deficit Forecast

  • New Socialist-led government set to boost social programs
  • Deduction limits for big companies are also on the table
Bakken oil
Photographer: Matthew Staver/Bloomberg
Updated on

Spanish Budget Minister Maria Jesus Montero said fiscal rigor shouldn’t trump economic growth as the new Socialist-led government raised its budget deficit forecast.

Spain, which has the European Union’s biggest budget deficit ratio, is relaxing its targets to boost retiree benefits, expand health care and take over toll-highway concessions. Economy Minister Nadia Calvino said Thursday the deficit is expected to reach 2.7 percent of gross domestic product this year, compared with the last government’s 2.2 percent estimate.