Italy’s prime minister promised greater budget discipline and better relations with the EU as he was invited to form a new government that would stave off fresh elections and shut Matteo Salvini’s far-right League party out of power.
Giuseppe Conte was formally asked by president Sergio Mattarella to try to form a new coalition of the anti-establishment Five Star Movement and centre-left Democratic party (PD), an unlikely deal between two parties that have been fierce rivals.
Italy’s 10-year bond yields fell to their lowest level in two decades as investors welcomed the prospect of a government that would be less antagonistic to Brussels after months of tension between Rome and the European Commission over the country’s spending plans.