Italy's cabinet on Friday updated its budget plan, raising its forecast for deficit and debt for 2014 and cutting the growth previsions for this year.

The new forecasts forsee an economy contraction of 1.7 percent in 2013, compared to a 1.3-percent shrinkage projected in April. The budget deficit is likely to be 3.1 percent of GDP this year on current trends.

The government also said it expected its budget deficit to increase to 2.5 percent of the country's Gross Domestic Product (GDP) in ...

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