Brussels Edition: Mamma Mia

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Italy’s populist government thumbed its nose at the EU, setting its budget deficit target for next year at 2.4 percent of output in what is likely to deepen investor concerns about the path the country is taking. The size of the shortfall puts Italy in breach of its conventional obligations, an EU official told us, adding “Mamma Mia.” In a joint statement, Deputy Premiers Matteo Salvini and Luigi Di Maio called it a “budget for change.” Finance Minister Giovanni Tria had advocated for greater prudence, and now his future in the government is in doubt. The big question now is how markets will react.