Economy Minister Giulio Tremonti promised on Sunday to meet Italy's budget pledges after growing speculation over whether the European Central Bank may cut back its purchases of Italian government debt, according to Reuters. Tremonti, under mounting pressure to present a credible plan to fulfill a pledge of balancing the budget by 2013 and cutting Italy's 1.9 trillion euro debt pile, told a business conference in the northern town of Cernobbio that the target would be met. However he admitted that a hastily put-together package of measures presented to parliament in August and now undergoing substantial revision, had been incomplete. "When you take measures in four days you can make mistakes, it's true," he told a conference discussion. The regular Ambrosetti conference in Cernobbio near Milan this weekend has brought growing doubts about the 45.5 billion euro austerity package to a head following a week of rising market pressure on Italian government bonds. Both ECB President Jean-Claude Trichet and Italy's head of state, President Giorgio Napolitano issued strong calls for swift action following widespread criticism of the haphazard way in which the plan was being handled. Marco Tronchetti Provera, chairman of tyremaker Pirelli, one of the icons of Italian industry, said Tremonti's speech to the conference had been clear but it had not eliminated doubts about the gravity of the situation. "I repeat that anyone who is not concerned about this situation is making a mistake," he told reporters. The head of Confindustria, Italy's largest employer federation also took aim at the government during the conference, saying the plans presented so far did not do nearly enough to stimulate the country's anaemic growth rates. Underlining the growing concerns, the premium investors demand to hold Italian debt rather than benchmark German bonds rose on Friday to 331 basis points, the highest since the ECB started buying Italian paper in August. Yields on 10-year Italian bonds ended the week at 5.29 percent, creeping back up towards the 7 percent level generally regarded as unmanageable. -- SPA
