The Spanish Socialist Workers' Party (PSOE) won the most seats in the country's parliamentary election Sunday but fell short of the majority needed to form a government alone.
The socialists of Prime Minister Pedro Sanchez led with 123 seats in the 350-seat parliament, according to a tally of results from the interior ministry with all votes counted.
The far-left Unidas Podemos was on 42, leaving the two parties combined just 11 seats short of a majority. Still, the leftist political bloc in the country holds an advantage over its right-leaning rivals in the national election.
The right-wing mainstream conservative PP party was pegged at just 65 seats, with center-right Ciudadanos on 57 and the far-right Vox on 24.
Sanchez called the election in February. This came after Catalan pro-independence parties, on whose support Sanchez's minority government relies, joined forces with the center-right opposition and rejected the government's 2019 budget proposals.
Sanchez has been at the helm of government for less than a year. He came to power in June 2018 after a vote of no-confidence in the previous People's Party (PP) administration, under conservative Mariano Rajoy. It's also Spain's third national election in four years.
Opinion polls in recent weeks consistently signaled that Sanchez's socialists would win the largest share of the vote — but not enough for the party to govern alone. The polls also suggested a sizable far-right presence for the first time since the nationalist dictatorship of General Francisco Franco, who ruled over Spain until his death in 1975.
Several weeks, if not months, of discussions are now expected as different parties look to form alliances in order to create a coalition government.
Whoever eventually forms a government will have to focus on boosting the economy and job creation. They will have to maintain a reform drive to make the country more competitive but tackle a rise in nationalist sentiment and the thorny and unresolved issue of pro-independence parties in Catalonia pushing for another referendum.
Spain's economy has recovered in recent years following its major banking crisis, prompted largely by the bursting of a property and construction bubble. However, in its latest winter forecasts, the European Commission predicted a slight slowdown in gross domestic product (GDP) growth of 2.1% in 2019 and 1.9% in 2020.
—Reuters contributed to this article.