Italy's populists agree on a government, close to deal on PM

Five-star and the League are moving closer

Five-star and the League are moving closer

Italy's far-right League and the anti-establishment Five Star Movement, which are now negotiating to form a new coalition government in Italy, over the weekend turned their sights toward selecting a candidate for prime minister. He also declined to say who might be their choice of prime minister.

Italian media reported that Di Maio had told the president's office on Sunday night they would be ready to submit their plan to Mattarella and name a prime minister on Monday.

Matteo Salvini, head of the League, said in a statement over the weekend that he and Di Maio were "writing history".

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The parties are due to meet President Sergio Mattarella.

Mattarella, normally a low-profile figure, warned over the weekend about the importance of Italy running sound public finances and maintaining its traditional pro-European Union positions. Mattarella's office has said the head of state would work to ensure the government team is qualified for its task, doesn't jeopardize state finances, and respects Italy's worldwide commitments.

If Mattarella endorses the candidate, programme and cabinet lineup then he could nominate a prime minister on Monday, paving the way for a government to be sworn in this week before facing a vote of confidence in both houses of parliament. These measures are likely to set Rome on a collision course with Brussels as the new government has vowed to ignore the budgetary restrictions now in place due to the Italian government's deficit.

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The economic promises made by both parties during the campaign seem incompatible with Europe's budget rules, though investors - generally made uneasy by any prospects of fiscal slippage by governments - seemed little fazed on Monday.

5-Star's flagship policy of a universal income for the poor will cost an estimated €17bn per year.

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