Salvini Says Italy's Populist Coalition Talks on Last Lap

(Bloomberg) -- The leader of the anti-migrant League Matteo Salvini said talks with the Five Star Movement on a populist government for Italy have entered their final lap.

“We’re in the final stretch,” Salvini said in a Facebook video. “I’m working right until the end to see whether it will be possible.”

The parties are still trying to find the right balance between their two policy platforms, Salvini added. Lawmakers from the two parties are due to continue negotiations on a policy program Wednesday morning, according to a Five Star official who asked not to be named.

More than ten weeks after Italy’s inconclusive election on March 4, the two politicians are still trying to broker an agreement after repeatedly blowing through deadlines set by President Sergio Mattarella. Italian stocks and bonds have remained unruffled by the turmoil.

The FTSE MIB index rose 0.3 percent, keeping the benchmark’s year-to-date gain at 11 percent, the best performance among major Western markets, as investors stay focused on fundamentals such as corporate profits and an improving economy. Government bonds fell Tuesday, though less than the rest of Europe, pushing the spread between Italy’s 10-year bonds and German bunds to a one-week low of 131 basis points.

Five Star’s 31-year-old leader Luigi Di Maio struck an optimistic tone in his own Facebook video earlier in the day.

“The fundamentals are there,” he said. “We’ll have to see if we can manage to put together a contract.”

Still, the two leaders haven’t said yet who they’ll nominate as prime minister -- and they say it won’t be announced until they have an agreement on policies.

Salvini told his supporters he’ll ask them to endorse any agreement he eventually strikes with Five Star.

“If there’s an agreement we’ll get started, but first I’ll ask you,” he said, addressing the camera. “Otherwise the only way is to ask Italians to go back to elections"

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