Mario Draghi, the prime minister of Italy, submitted his resignation to President Sergio Mattarella on Thursday after his unity government disintegrated, throwing the nation’s politics and financial markets into disarray.
The head of state had taken note of the resignation, according to a statement from Mr. Mattarella’s office, and had urged Mr. Draghi to continue in a caretaker capacity.
What Mr. Mattarella would do next was not stated in the statement.
Earlier this week, political insiders predicted that he would dissolve parliament and call for early elections in October.
On Thursday afternoon, Mr. Mattarella intended to meet with the speakers of the two houses of the legislature.
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On Wednesday, Mr. Draghi’s coalition in Italy disintegrated after three of his key allies refused to participate in a vote of confidence he had convened in an effort to mend fences and revive their turbulent partnership.
Months of stability in Italy have been upended by the political turmoil. During that time, Mr. Draghi, a respected former central banker, helped define Europe’s firm reaction to Russia’s invasion of Ukraine and improved Italy’s standing on the financial markets.
On Thursday, Italian bonds and stocks experienced a significant decline as markets prepared for the European Central Bank’s first interest rate increase since 2011.
Italian stocks (FTMIB) began lower by 1.8% as benchmark 10-year bond yields in early trade jumped over 20 basis points to their highest level in over three weeks.
After one of his partners, the populist 5-Star Movement, refused to support him in a vote of confidence on policies to combat the rising cost of living, Mr. Draghi had already tendered his retirement last week.
On Thursday, the president’s office announced that Mr. Draghi’s administration will continue in place for the time being to manage ongoing work, but no additional actions regarding Italy’s political future were specified.
Prior to his meeting with the president, Mr. Draghi informed legislators that he did not believe he could continue to lead the country after losing a Senate vote on Wednesday night.
(Reuters/NAN)
