Milan, Italy (AHN) – Amid growing political uncertainty in the country, the yield on Italian 10-year bonds on Monday rose from 6.37 percent to what is described as an Euro-era high of 6.64 percent.

Analysts fear the eurozone’s third biggest economy, Italy, which had been widely praised for its tactics during the last recession, may become the debt crisis’ next victim.

Meanwhile, speculation is in the air of Prime Minister Silvio Berlusconi’s possible resignation – a development vehemently denied by the billionaire-turned politician. “Rumors of my resignation are baseless and I do not understand how they started circulating,” Berlusconi reportedly told his aides.

Fabrizio Cicchitto, leader of the People of Freedom party, confirmed that the Berlusconi discussed the rumors with him on Monday, adding that they were without foundation.

Berlusconi’s former spokesman Giuliano Ferrara, who is now editor of Il Foglio newspaper, reported the premier would resign within hours. In his article, he wrote that Berlusconi’s exit would likely come next week while he was seeking support of economic growth measures and austerity.

The rumors came just hours before Tuesday’s crucial vote on public finance. The rumors briefly reversed earlier losses at European markets. The FTSE MIB index gained 2.4 percent at 4 p.m. in Milan.

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AHN · Berlusconi · bonds · Denies · Euroera · freedom party · Giuliano Ferrara · High · il foglio · Italian · Italy · Milan · milan italy · Monday · percent · political uncertainty · Prime Minister Silvio Berlusconi · resignation · rumors · silvio berlusconi

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