(Bloomberg) -- The Spanish government is expecting to receive a letter from the European Commission seeking clarity on some aspects of its budget, but is confident that the plan be cleared, according to a budget minister official.

The official said Madrid has received similar letters in the past and insisted that Spain’s situation is completely different to Italy’s. The country’s budget deficit is declining even if the government is seeking more leeway to meet its targets and the plan includes a reduction in the so-called structural deficit, the Spanish official said.

Spain’s bonds fell on Friday, sending the 10-year yield as much as 10 basis points higher to 1.82 percent, a level last seen in March 2017.

Italy may become the first euro member to see its budget rejected by the European Commission after it was warned Thursday that its 2019 plans represent an "unprecedented" deviation from EU rules. Spanish asset markets have also been hit by a court ruling Thursday that banks should pay client expenses on mortgage documents.

The Socialist government’s projection for a deficit of 1.8 percent of GDP next year is bigger than the 1.3 percent targeted at the start of the year by the previous administration. Yet the administration will cut its structural deficit, adjusted to take the economic cycle into account, by 0.4 percentage points. An EU official said the Commission is focusing on Spain’s structural deficit and it is broadly in compliance with the rules.

Prime Minister Pedro Sanchez said Thursday at an EU summit in Brussels that he is confident the bill be cleared by the Commission. His biggest obstacle will be winning the backing of Parliament, where his minority government has 84 out of 350 seats.

To contact the reporters on this story: Maria Tadeo in Madrid at mtadeo@bloomberg.net;Viktoria Dendrinou in Brussels at vdendrinou@bloomberg.net

To contact the editors responsible for this story: Fergal O'Brien at fobrien@bloomberg.net, Ben Sills, Charles Penty

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