Rome May 29 (IANS/AKI) Italy s President Sergio Mattarella will on Wednesday continue talks with pro-austerity Premier-designate Carlo Cottarelli on a technocrat government as the gap in Italian and German 10-year bond yields reached a five-year high amid investor fears of a snap election.
Cottarelli whom Mattarella asked on Monday to try and form a caretaker government is close to giving up his bid and did not submit a cabinet line-up to Mattarella parliamentary sources told AKI.
Italy s grassroots Five-Star Movement and the far-right League party are demanding new elections in July and have said their lawmakers will not vote confidence in Cottarelli - a former International Monetary Fund director known as Mr Scissors in Italy for his enthusiasm for spending cuts.
A nascent Five-Star-League government collapsed on Sunday after its Premier-designate Giuseppe Conte a law professor resigned when Mattarella vetoed the populists choice of Finance Minister - the prominent eurosceptic economist Paolo Savona.
Italy has been in political limbo since the inconclusive March 4 national polls in which populist parties made strong gains but no single political force won an outright parliamentary majority. Several rounds of post-election talks with part leaders collapsed amid a mesh of seemingly irreconcilable demands.
Five-Star and the League may form an electoral alliance ahead of fresh elections and a survey for left-leaning daily La Repubblica on Monday predicted they could win 90 percent of seats in Italy s parliament in a re-vote.

--IANS/AKI
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