In Spain, incoming governments need to secure the support of a parliamentary majority in order to take office. Spain's socialists are now being pressured to abstain from such an "investiture vote" in order to allow Rajoy to become prime minister and avoid the need for yet another election. There is no guarantee that the socialist party will be willing to facilitate a Rajoy-led government, however.
Antonio Barroso, deputy Director of Research at Teneo Intelligence, said in a note Wednesday that despite Rivera upping the ante with its approach to the PP, Rajoy's re-election was "still not a done deal."
"While the proposed institutional reform and anti-corruption measures should be palatable to the PP, Rajoy's re-election is not a done deal, however, as this will still require the abstention of the socialists (from the investiture vote). A PP-led minority government remains the base case scenario (60 percent) but a third round of elections cannot be discarded given parties' entrenched positions," Barroso said.
"Regardless, it is unlikely that any major decisions to resolve the issue will be taking before the last week of August/early September," he added.
Apolline Menut, European economist at Barclays, was more confident, stating in a note Thursday that a "government was in sight" and that the PP exec committee was likely to approve Ciudadanos' demands, paving the way for an investiture vote by early September.
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