Giuseppe Conte has been designated as Italy's next prime minister and is expected to be sworn in on Friday, after the populist Five Star Movement and anti-immigrant League party reached a deal to form a coalition government.
After weeks of political drama that had at one stage seemed certain to lead to new elections, President Sergio Mattarella named political novice Giuseppe Conte as prime minister for the second time in less than a fortnight and approved his revised cabinet.
"The new government will make sure that the rights and the dignity of 60-M Italians will be respected", Mr. Salvini said in a statement, adding that "Italians expect from Europe cooperation and not insults".
The coalition deal turns the page on months of political turmoil following an inconclusive election in March which had raised jitters among Italy's European partners.
Salvini, the head of the League, has said he would "seriously consider" an offer on Wednesday from 5-Star leader Luigi Di Maio to resurrect their bid to govern together.
Mattarella then proposed Carlo Cottarelli, a non-political former International Monetary Fund official, to form a technocrat government to lead the country to new elections.
"The initiative for a new anti-establishment government. would have to imply a credible pro-European commitment and a commitment to the Italian Constitution, i.e. the fiscal framework, to have any chance of flying", Codogno said.
After months of uncertainty in the eurozone's third-biggest economy, Italy's blue-chip share index was up more than 2 percent, as banks recovered from a rout and government bond yields moved sharply lower in early trade.
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It prompted threats of retaliation from the European Union on United States products before the policy was abandoned. Malmstrom is meeting US Trade Representative Robert Lighthizer in Paris today among other global trade chiefs.
"Now we have five years in government", she said.
The possibility that the 5-Star government and the League could come up with a government acceptable to Italy's president buoyed financial markets, despite their eurosceptic views.
Di Maio, the new economic development minister, reported for work after the parade to his ministry, which would have otherwise been closed for the holiday.
The leaders of the right-wing League and the 5-Star Movement patched up their alliance after agreeing to substitute a eurosceptic they had initially proposed as economy minister, a nomination that had been rejected by the head of state.
Conte made no comment to reporters after his swearing-in ceremony in the president's 16th century palace in Rome, in a room with a huge gilt mirror flanked by Italian and European Union flags.
The new economics minister, Giovanni Tria, is a mainstream economist at Rome University, while the foreign ministry goes to Enzo Moavero Milanesi, a former European Union official in Brussels who was European affairs minister in former Premier Mario Monti's two-year technical government.
Conte has so far left policy specifics to the drivers of his improbable rise, his two deputies: Salvini and 5-Star leader Luigi Di Maio. The former even called for Mattarella's impeachment, but withdrew that threat after only a few days.
Financial markets have calmed amid signs that Italy may avoid imminent elections after President Sergio Mattarella gave two populist parties time to figure out whether they can agree on an alternative to a euroskeptic economy minister. "That means more work, less corruption, seriousness", he said.