Italy's 5-Star, League on verge of govt deal

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"From Europe we have the umpteenth unacceptable interference (...); now is the time for legality, security and push-backs", Salvini said.

The League and 5-Star have failed to agree on forming a coalition between themselves after an inconclusive election on March 4, but they have enough votes together in parliament to block any other government from taking office.

"We have made a lot of good progress. we should finish the program today", Salvini said during a live video stream on Facebook.

This will now be something to watch as populism is back on the agenda for markets where the coalition has radical ideas to free up billions of euros for tax cuts and welfare.

Salvini dismissed concerns about the widening gap, or spread, between Italy's benchmark bonds and safer German ones as a sign the two potential partners were on the right track.

According to Italian media reports, their nominee for Prime Minister is likely be from a "third party" and will have to be able to make the eurosceptic nature of the new government workable with Brussels. He declined to comment on the outcome of the coalition talks.

Both groups have a history of euroskepticism.

Hours after the document leak, 5-Star and the League issued a further joint statement saying they wanted to "reconsider" the Eurozone's fiscal rules with Italy's partners "in the spirit of returning to the pre-Maastricht set-up" - a reference to the treaty which laid the groundwork for monetary union.

They also share an anti-establishment sentiment that has taken root in Italy but which has worldwide parallels such as Britain's vote to leave the European Union and the USA election of President Donald Trump.

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