Italy’s two populist parties have revived their plans to form a coalition government and again put forward Giuseppe Conte as prime minister.
President Sergio Mattarella has reportedly summoned Mr Conte and is expected to hand him his second mandate in eight days to form a government.
Stop-gap PM designate Carlo Cottarelli has stepped back from forming a technocratic government, reports say.
Mr Mattarella had rejected Mr Conte’s original choice for finance minister.
But the populist Five Star (M5S) and League parties have reportedly agreed on another candidate.
Sources in Five Star said economics professor Giovanni Tria will get the post. He is critical of the European Union but not an advocate of leaving the euro, making him more acceptable to President Mattarella.
How did we get here?
4 March: Inconclusive elections left Italy, the EU’s fourth-biggest economy, without a government.
The anti-establishment and populist Five Star was the biggest single party in parliament and attempted to form a coalition with right-wing populists the League.
They put forward Mr Conte, a political novice, as prime minister in an attempt to break Italy’s political deadlock.
28 May: In a day of rapidly moving events, Mr Conte takes his cabinet choices to Mr Mattarella but the president vetoes the choice of Paolo Savona as finance minister.
Mr Mattarella said he could not appoint the eurosceptic to the post, citing concern from investors at home and abroad. Mr Conte declines to suggest an alternative then surrenders his mandate.
The rare move sparked fury from both parties. Five Star leader Luigi Di Maio called on parliament to impeach Mr Mattarella.
Later, the president asked ex-IMF economist Mr Cottarelli to form a government until fresh elections could be held. Mr Cottarelli is nicknamed “Mr Scissors” for his cuts to public spending in Italy.
29 May: The dust shows no sign of settling and Italy’s political turmoil spreads to financial markets across the world.
The prospect of fresh elections and the possibility of eurosceptic parties strengthening their position in Italy raised concern about the eurozone’s stability.
30 May: Italian leaders announce fresh talks are being held to try to overcome the impasse.
Italian media quoted Mr Cottarelli as favouring “a political government” and saying he was waiting for “further developments”.
He appeared to have suspended his own efforts to form an interim administration and could instead be giving Five Star and the League a second chance, says BBC Rome correspondent James Reynolds.
31 May: Five Star and the League say they have agreed to restart coalition negotiations.
“All the conditions have been met for a M5S-League government,” a joint statement from the party leaders said.