The eurozone’s overall budget deficit in 2003 could break the fiscal rules underpinning the currency because of a larger-than-expected French deficit, the European Commission said today.

The European Commission has said the state of the French economy and its budget deficit will be an "important subject" of its talks tomorrow with French prime minister Jean-Pierre Raffarin.

The European Commission is to look at the EU's stability and growth pact rules over fines for countries breaching the deficit limit of 3% of GDP for three years in a row.

THE US administration is more concerned with monopolising global food production than combating famine, MEP Patricia McKenna said yesterday.

The European Commission warned Germany today that planned tax cuts should not lead to a violation of EU budget deficit limits for a third successive year.

THE European Commission said yesterday it was likely to cut its euro zone growth forecast for 2003 from the current 1.8% due to pressures from a slower than expected pick up and geo-political uncertainty.

A European Commission spokesman said the early estimate for the eurozone's harmonised index of consumer prices in September is "not a very positive result".

The higher euro's impact in reducing inflation and boosting domestic demand will stimulate growth in the second half of the year, commission monetary affairs spokesman Gerassimos Thomas said.

The European Commission said it expects EU finance ministers, at a meeting tomorrow, to approve broad economic policy guidelines committing all member states to a 2004 deadline for balancing their budgets.