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The ruling coalition of Five Star Movement and League said late on Thursday they agreed to proceed with a budget deficit of 2.4 percent of GDP and to press ahead with supporting the unemployed with a minimum income.

Their plans defy EU bosses’ demands for Italy to take better control of its debt, which risks spiralling out of control and causing a potential financial crash across Europe.

Brussels is yet to receive a copy of the budget and is relying on reports emerging from Rome of its contents.

Armando Marozzi, an analyst at Medley Global Advisors, warned that Italy will suffer a series of “tough” setbacks as Brussels and various rating agencies crackdown on the budget.