Italy exit polls point to political gridlock

Early results from parliamentary elections in Italy appeared to show gridlock, with a centre-left coalition pulling ahead in the lower house and the centre-right bloc headed by former prime minister Silvio Berlusconi leading in the equally powerful senate.

The upstart protest campaign of comic-turned-politician Beppe Grillo was also showing a stunningly strong result on Monday in both houses of the legislature, confirming its surprise role as a force in Italian politics.

The murky result raised the possibility of new elections in the coming months, and bodes badly for the nation’s efforts to pass the tough reforms it needs to snuff out its economic crisis.

After surging in the wake of exit polls, Milan’s main stock index slumped with first projections before closing up slightly.

Pier Luigi Bersani’s centre-left coalition, which has shown a pragmatic streak in supporting the tough economic reforms , was leading in the lower house with about 35.5 percent of the vote, according to exit polls. Berlusconi’s coalition was polling second at 29 percent.

In the senate, projections by the Piepoli Institute for RAI public TV showed Berlusconi’s coalition slightly ahead with 31 percent to Bersani’s 30 percent. Grillo’s movement had 24.6 percent, and current prime minister Mario Monti’s centrist forces had 9.4 percent.

Sky’s Senate projections showed Berlusconi with a two-point lead over Bersani, and Grillo with 25 percent.

Economic uncertainty

Bersani’s party would have to win both houses to form a stable government, and given the uncertainty of possible alliances, a clear picture of prospects for a new Italian government could take days.

The uncertainty pushed Italian and European stock indexes down in late trading on Monday.

Italy’s economic woes include huge public debt, high interest on that debt and a lack of growth which currently stands at levels similar to Haiti and Zimbabwe. Italy is the eurozone’s third largest economy, and its public debt, second only to Greece, is sky high at 120 percent of GDP.

Bersani, a former communist, has reform credentials as the architect of a series of liberalization measures and has shown a willingness to join with Monti, if necessary, to form a stable government.

But he could be hamstrung by the more left-wing of his party, and Grillo’s stunning surge shows Italians are fed up with painful economic cures.

Turnout was 75 percent, down nearly 6 percentage points from the rate in the last national election in 2008. Experts say a low turnout will hurt the mainstream parties. Usually around 80 percent of the 50 million eligible voters go to the polls.