"I am fighting for a Europe that understands we could die from austerity and that to follow a policy of austerity alone only rewards Le Pen and eurosceptics like Grillo," he said, referring to French National Front leader Marine Le Pen and leader of Italy's Five Star Movement Beppe Grillo, both prominent antagonists of Brussels.
Italy's government debt is forecast to reach 134 percent of GDP by 2014, and the European Commission warned on Friday the southern European nation may miss previously agreed debt-reduction targets.
"Our debt is high but it is decreasing, and the proof is in our interest rates, which I find encouraging," Letta said.
"Too much belt-tightening risks suffocating the economic recovery," he added.
Though defiant, Letta conceded that despite "signs of recovery" in Italy, the effects of the crisis were still "very serious".
Using new post-crisis powers, the Commission approved the draft budgets of all 13 eurozone countries which are not in bailout programmes on Friday, but issued stern warnings to France, Spain and Italy that they must keep unwaveringly to their budgets for 2014.
Italy's debt has the highest government debt in the eurozone after Greece.