ROME– Italy forecasts its debt to skyrocket to a brand-new post-war record level of 158.5%of gross domestic output (GDP) this year, exceeding the 155.6%objective it set in September, a federal government source told Reuters on Saturday.

The brand-new price quote reflects the impact of a stimulus plan worth 32 billion euros ($39 billion) announced this week, which will drive the 2021 deficit spending to 8.8%of national output, up from 7%previously targeted.

The extra spending will be used to help the hard-pressed nationwide health service, fund grants and furlough plans to businesses required to close due to coronavirus lockdowns, and offer cover for a postponement of tax payment due dates.

The government is because of update its debt and deficit targets in April.

Rome’s substantial public financial obligation is the 2nd highest in the euro zone after that of Greece.

Regardless of the greater projections for 2021, nevertheless, the debt figure for 2020 is anticipated to come in lower than formerly estimated, the source stated, asking not to be called.

Rome is now expecting the 2020 debt-to-GDP ratio to be 156.5%, listed below the main target set in September of 158%, which formerly was the greatest level given that World War II. The 2020 deficit is seen at between 10.5%and 10.8%of national output.

The final deficit and debt figures for last year will be released by national statistics bureau ISTAT in March.

($ 1=0.8280 euros) (Reporting by Giuseppe Fonte, modifying by Elvira Pollina and Clelia Oziel)

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