ROME, ITALY (REUTERS) - Italian Prime Minister Matteo Renzi arrived at the presidential palace intending to hand in his resignation.

Mr Renzi said he would resign after Italians voted against reforming the country's parliamentary system in a national referendum.

Instead, he will stay on in power until the 2017 budget has been approved by parliament.

Renzi's decision to quit has triggered speculation that an early election could follow.

That could pave the way for the far-right Five Star Movement to take power.

One of its members was applauded as he strolled next to the prime minister's office on Monday evening (Dec 5).

In the meantime Italy's president Sergio Mattarella will consult with party leaders before naming a new prime minister, the country's fourth in succession to be appointed without an electoral mandate.