Italian president tasked two groups to try to end political impasse

ROME (AFP) - Italian President Giorgio Napolitano on Saturday asked two unidentified "groups" to come up with a programme for government in a bid to end a deadlock between parties more than a month after elections that left no clear winner.

Mr Napolitano stressed that outgoing Prime Minister Mario Monti's government would remain in charge until a new cabinet is formed and ruled out his own early resignation - a scenario that had been mooted to help resolve the crisis.

The 87-year-old did not identify the "two restricted groups of different personalities" but officials said this would be clarified later on Saturday.

Analysts said the groups could be made up of party representatives as well as non-political "institutional" figures.

Mr Napolitano said his latest round of talks with political forces on Friday had shown up "distinctly different positions" and called for "a greater sense of responsibility".

He also said Mr Monti, a former European commissioner drafted in to drag Italy out of the euro zone debt crisis in 2011, represented "an element of certainty".

Mr Pier Luigi Bersani's centre-left coalition, which secured the most votes in the elections but failed to win a majority, ruled out an alliance with Mr Silvio Berlusconi's centre-right grouping which came a very close second.

Mr Bersani was asked by Mr Napolitano last Friday to try to form a government but admitted on Thursday that his efforts had come to nothing, after he failed to woo rival parties to support his cabinet.

Mr Napolitano's announcement de facto withdrew the mandate from Mr Bersani.

Mr Berlusconi, a scandal-tainted billionaire tycoon who has been prime minister three times in a 20-year political career, has said a cross-party deal is the only viable solution.

The anti-establishment Five Star Movement party, which came in third, has ruled out support for a political cabinet but has left open the possibility of backing a technocratic government of non-political figures.

Italians fed up with austerity and politicians' perks voted in their millions for the Five Star Movement led by former comedian Beppe Grillo, which won a quarter of the vote and became Italy's single biggest party.

Developments in Italy are being closely watched by European capitals under similar pressures over budget cuts, as well as investors concerned that Italy could plunge back into the turmoil of the euro zone debt crisis.

Investors have been relatively calm so far and reactions on stock and bond markets have been muted - mainly because of confidence in Mr Monti.

Analysts say Italy has to find a government solution before markets re-open on Tuesday, however.

Mr Monti has been governing with interim powers since December when lawmakers from Mr Berlusconi's People of Freedom party withdrew their support.

Business leaders have warned that bickering politicians have no time to lose as Italy endures a painful recession and severe unemployment.

The government is forecasting the economy will shrink by 1.3 per cent this year, and some analysts predict the end result could be even worse.

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