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The euro area’s budget deficit will swell to a record next year with all 16 countries breaching EU rules as governments keep pumping cash into their economies, the European Commission forecast.

The budget shortfall for the 16 nations that share the euro will widen to 6.9 per cent of gross domestic product next year from 6.4 per cent in 2009, and ease to 6.5 per cent in 2011, the