Monti vow fails to calm markets
Premier Mario Monti said he will lead Italy until the next government takes power, insisting there will be "no decision-making vacuum" despite his intention to resign ahead of time.
Despite his bid to calm markets, they kept on edge, sending stocks and bonds plunging.
Mr Monti announced on Saturday he is resigning early because Silvio Berlusconi's party, Parliament's largest, withdrew its support for his economic policies.
The same day, Mr Berlusconi said he was running to get the premiership back, despite his party lagging in the opinion polls.
Italian markets slumped as investors feared a new era of political instability. Some worry that a return to party politics under an elected government could threaten the reforms that Mr Monti has been pushing through to restore confidence in the country's financial future.
From Oslo, Norway, where he was attending the Nobel Peace Prize award to the EU, Mr Monti said that the financial market drops in Italy "shouldn't be dramatised". He also sought to reassure those worried about what the elections will yield, following the end of his technocrat government.
He said he was "fully confident" that the next government will be "highly responsible" and "in line" with policies needed for the good of Italy's economy and the European Union in a wider context.
An economist appointed last year to save Italy from succumbing to the eurozone debt crisis, Mr Monti has said he will step down as soon as Parliament passes the 2013 budget law later this month.
His term was due to end by April, and his resignation would move up elections by about two months.
Without Mr Monti in the race, the strongest candidate in opinion polls as been centre-left leader Pier Luigi Bersani. Although Mr Bersani staunchly backs the Monti government, left-wing MPs have been wary about labour market reform plans.