An informed source said Thursday that the Italian president wants political parties to reach an agreement on forming a new government coalition within the next few days if they want to avoid early elections.
Political turmoil hangs over the euro zone's third-largest economy after its government collapsed this week after months of internal wrangling, forcing Prime Minister Giuseppe Conte to resign as Rome began preparing for the 2020 budget.
The beginning of the collapse came from the right-wing League, whose leader Matteo Salvini announced the death of the ruling coalition two weeks ago, saying that he could no longer work with his coalition partner 5-Star.
Salvini, who is interior minister, has called new elections with the aim of returning to power as prime minister with a mandate that would enable him to launch a major spending package next year and defy European Union fiscal rules.
President Sergio Mattarella began consultations to form a new government after Conte resigned on Tuesday, who accused Salvini in his stepping down speech of endangering the economy for personal and political gain.
On Thursday, Mattarella will meet representatives of the opposition center-left Democratic Party and 5-Star on forming a ruling coalition.
Both parties fear Salvini, whose anti-EU and anti-immigrant stance has earned him support in opinion polls at their expense, and believe he could score a major victory if elections are held now.
Financial markets have rallied since Conte's resignation, apparently in the hope that the 5-Star coalition and the Democratic Party will succeed in averting an early election. Some investors fear that if Salvini becomes prime minister, he will increase spending and put the heavily indebted country on a collision course with the European Union.
However, Mattarella is insisting on a short deadline and wants to see clear indications of a possible new alliance agreement on Thursday and major developments by the beginning of the next week, the informed source said.