Italy’s Bersani struggles to overcome election stalemate

Italian centre-left leader Pier Luigi Bersani was left with only a slim hope of forming a government after last month’s deadlocked election as talks with rival party leaders ended with a further rejection from Beppe Grillo’s 5-Star Movement.

The impasse inItalyhas been closely watched by investors mindful of the turmoil which brought down Silvio Berlusconi’s government in 2011 and was reflected in rising borrowing costs at a closely watched bond auction on March 27.

Without an agreement, the country could be headed for fresh elections, adding to the uncertainty facing the euro zone which is battling to contain the crisis inCyprus.

The rebuff by 5-Star was expected as the anti-establishment group has always said it will not back the parties it blames for Italy’s social and economic crisis but it was given added spice by an insulting blog post put up by the fiery ex-comic Grillo.

Bersani called on all parties to ‘accept their responsibilities’ and allow a government to be formed, but there was little sign of movement from the other parties.