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Mattarella Expected to Extend Talks on New Tie-Up: Italy Update

Democratic Chief Won’t Seek Alliance ‘at any Cost’: Italy Update

(Bloomberg) -- Italian President Sergio Mattarella is meeting with the country’s main political leaders on Thursday in a bid to either carve out a viable governing coalition or pave the way for early elections. The Democrats and the anti-establishment Five Star Movement, long antagonists, are in talks to form an alliance, and Mattarella has indicated he could give them a couple extra days to iron out a deal. If those negotiations fail, the hard-line League leader Matteo Salvini, who is currently leading in the polls, would be in prime position to take control of the government.

Key Developments:

  • Mattarella meets with key party leaders on Thursday from the Democratic party, Forza Italia, the League and Five Star
  • Prospects for a coalition improved after smaller parties and independent lawmakers said they’re opposed to a snap ballot
  • The Italian president has given the Democrats and Five Star a Monday deadline to stitch up an alliance
  • Italian bonds rose on the prospect new elections would be avoided

Five Star Says Talks Started on New Majority (5:50 p.m.)

Five Star leader Luigi Di Maio said he has started talks to form a new majority, signaling he would be open to a tie-up with the Democratic party.

“We aren’t afraid of a new vote, but that can’t be the the way out of the promises we made to Italians. We still have plenty to do,” Di Maio told reporters, outlining a 10-point agenda that a new government would need to pursue.


PD Expect Deadline Extension for Five Star Talks (5:23 p.m.)

The Democratic party expects Mattarella to give it more time to work out an alliance with Five Star, according to party officials who asked not to be named as the talks are private.

The extra time follows days of informal contacts between leaders of the two parties, Luigi Di Maio and Nicola Zingaretti, and formal consultations held with Mattarella Thursday.

The president has made clear to both parties that he is either seeking a stable coalition option, or will opt for a snap vote.


Salvini Says the Door Still Open to Five Star (5:09 p.m.)

Speaking after a 50-minute meeting with Mattarella, Salvini told reporters that a snap vote was the best way out the current political crisis.

Salvini, who has been governing with Five Star for the last 14 months, also said that he would be ready to go back to the drawing board with Luigi Di Maio if he would be willing to change certain policy positions.


Berlusconi Says Center-Right Alliance or Election (12:57 p.m.)

Mattarella Expected to Extend Talks on New Tie-Up: Italy Update

Former Prime Minister and Forza Italia President Silvio Berlusconi blasted the possible tie-up between the Democrats and Five Star, saying that if there isn’t a way to patch together a center-right alliance then there should be new elections.

“A government strongly skewed to the left would be dangerous for businesses and for citizens’ liberty,” Berlusconi told reporters after meeting with Italian President Sergio Mattarella. What’s needed, he added, is “a center-right majority that corresponds to Italians’ wishes. If that’s not possible, the main alternative is elections”


Italian Bonds Rally for a Third Day (12:29 p.m.)

Investors took solace in the possibility that elections could be avoided.

Italian bonds rallied for a third day as investors pushed out the chance of fresh elections in the fall. Ten-year yields dropped three basis points Thursday to 1.31%, the lowest level since 2016. The spread over Germany, a key gauge of risk in the nation, dropped to 196 basis points, the narrowest in nearly a month. Italian stocks bucked declines across much of the region, climbing 0.4%.


Democratic Chief Says Available to Form Govt (11:55 a.m.)

Mattarella Expected to Extend Talks on New Tie-Up: Italy Update

Leader of the Democratic Party Nicola Zingaretti told Italian President Sergio Mattarella that he’s available to form a new government, but won’t do so “at any cost,” according to remarks he made to reporters after meeting with the head of state.

Building a new majority “for us isn’t an easy choice because of the heavy past that the outgoing government left and because of the distance between us and Five Star,” he said. But we’re “concerned” by the current situation.

Earlier:

--With assistance from John Ainger.

To contact the reporters on this story: Lorenzo Totaro in Rome at ltotaro@bloomberg.net;Chiara Albanese in Rome at calbanese10@bloomberg.net

To contact the editors responsible for this story: Ben Sills at bsills@bloomberg.net, Richard Bravo, Jerrold Colten

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