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Italian President Giorgio Napolitano on Saturday asked two unidentified "groups" to come up with a programme for government in a bid to end a deadlock between parties more than a month after elections that left no clear winner.
Napolitano stressed that outgoing Prime Minister Mario Monti's government would remain in charge until a new cabinet is formed and ruled out his own early resignation -- a scenario that had been mooted to help resolve the crisis.
The 87-year-old did not identify the "two restricted groups of different personalities" but officials said this would be clarified later on Saturday.
Analysts said the groups could be made up of party representatives as well as non-political "institutional" figures.
Napolitano said his latest round of talks with political forces on Friday had shown up "distinctly different positions" and called for "a greater sense of responsibility".
He also said Monti, a former European commissioner drafted in to drag Italy out of the eurozone debt crisis in 2011, represented "an element of certainty".
Pier Luigi Bersani's centre-left coalition, which secured the most votes in the elections but failed to win a majority, ruled out an alliance with Silvio Berlusconi's centre-right grouping which came a very close second.
Bersani was asked by Napolitano last Friday to try to form a government but admitted on Thursday that his efforts had come to nothing, after he failed to woo rival parties to support his cabinet.
Napolitano's announcement de facto withdrew the mandate from Bersani.
Berlusconi, a scandal-tainted billionaire tycoon who has been prime minister three times in a 20-year political career, has said a cross-party deal is the only viable solution.
The anti-establishment Five Star Movement party, which came in third, has ruled out support for a political cabinet but has left open the possibility of backing a technocratic government of non-political figures.
"Mission Impossible", "Have Pity Please" and "Paralysis" read some of the headlines in the Italian press -- more than a month after an inconclusive vote in the eurozone's third largest economy.
"There is not even a point of contact between the three main parties," said Antonio Polito, a columnist for the top-selling Corriere della Sera daily.
Italians fed up with austerity and politicians' perks voted in their millions for the Five Star Movement led by former comedian Beppe Grillo, which won a quarter of the vote and became Italy's single biggest party.
Developments in Italy are being closely watched by European capitals under similar pressures over budget cuts, as well as investors concerned that Italy could plunge back into the turmoil of the eurozone debt crisis.
Investors have been relatively calm so far and reactions on stock and bond markets have been muted -- mainly because of confidence in Monti.
Analysts say Italy has to find a government solution before markets re-open on Tuesday, however.
Monti has been governing with interim powers since December when lawmakers from Berlusconi's People of Freedom party withdrew their support.
Business leaders have warned that bickering politicians have no time to lose as Italy endures a painful recession and severe unemployment.
The government is forecasting the economy will shrink by 1.3 percent this year, and some analysts predict the end result could be even worse.
Despite winning praise abroad for his reforms, Monti came a distant fourth in the polls at the head of a centrist coalition as the social cost of his measures has become increasingly evident with unemployment hitting record highs.
Most analysts predict that Italy will be forced to hold new elections within months at the earliest or a year at the latest, since stability is unlikely with the current three-way split of parliamentary forces.
Elections "could be in October and more probably next spring," Leonardo Morlino, professor of political science at Rome's Luiss University, told SkyTG24 channel.