Italy anti-establishment parties moot alliance

ROME. — Italy’s two main antiestablishment parties could yet form a government, after the man nominated as interim prime minister said politicians, rather than technocrats like himself, might be able to steer the country out of deadlock.

Wednesday’s development came as financial markets calmed after a rout a day earlier, when investor concerns about Italy’s finances prompted the biggest oneday rise since 1992 in Italian two-year bond yields and dented the euro’s exchange rate.

The crisis started when the 5-Star Movement and the right-wing League abandoned their plan to form a coalition after the head of state vetoed their choice of 81-year-old eurosceptic economist Paolo Savona as finance minister.

On Wednesday, Prime Ministerdesignate Carlo Cottarelli said possibilities had emerged “for the birth of a political government,” and that financial market turmoil and other circumstances, “have caused me to wait for further developments”.

For graphic on political crisis in Italy seats in parliament click https://tmsnrt.rs/2wAaJL2

A source close to President Sergio Mattarella, who vetoed Savona as finance minister and appointed Cottarelli to form a government to oversee fresh elections around the end of the year, said the two men had “decided together not to rush things, (to favor) a possible political government”.

Luigi Di Maio, head of the 5-Star Movement which emerged from inconclusive elections in March as the biggest party in parliament, appealed to the League to drop its insistence on Savona as economy minister, so that the two parties could resurrect their bid to govern together.

“Let’s find someone of the same caliber as Savona, who would still remain in the government in another ministry,” Di Maio said on Facebook after meeting with Mattarella.