EMU debt to GDP ratio slightly upwardly revised

Eurostat released its second notification of E(M)U debt and deficit data for 2011. These outdated numbers had no impact on markets. The EMU debt to GDP ratio was slightly upwardly revised from 87.2% to 87.3%. The EMU deficit to GDP was unchanged at -4.1% of GDP. When we look at a country level, there is especially a worsening in Spanish deficit data for 2010 (-9.7% from -9.4%) and 2011 (-9.4% from -8.5%). The increase in 2010 is mainly due to previously unrecorded unpaid bills. The increase in deficit is mainly due to the reclassification of capital injections by central government and to the previously unrecorded unpaid bills. These revisions confirm the idea that Spain might overshoot this year’s deficit target (-6.4% of GDP) as well. Tomorrow, Eurostat will release quarterly data (Q2 2012) on government debt.