Forex News – Berlusconi passes budget vote but not with majority

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The 2012 budget vote for Italy managed to pass in the Italian parliament today but it was not with a majority, meaning Prime Minister Berlusconi failed to garner majority support form the key lower parliament.

The results of the vote indicate that Berlusconi’s government no longer has a majority. Berlusconi’s governing coalition garnered 308 votes, seven votes shy of a majority needed in the 630 member-lower house of parliament.

This could lead to Italy’s president Giorgio Napolitano to again call on Berlusconi to face a confidence vote. The two will be meeting tonight for talks and most probably discuss whether he should step down.

In such a scenario, President Napolitano would then hold a series of consultation with Italy’s main political parties to decide whether to call early elections or form a new government.

Berlusconi could become the highest-profile political victim of the euro-zone crisis that has been ravaging the continent for the past two years. World leaders have been urging the premier to take key steps to reboot Italy’s economy, but the government has repeatedly failed to deliver.

The euro fell against most of its major counterparts after the news was released.