Italy’s Mario Draghi Likely to Resign Despite Winning Confidence Vote

The vote came after Mr. Draghi made an appeal to senators to back him so he could continue with his reform-minded agenda until the next scheduled national election in the spring. Now, elections could be held as soon as late September.

Mr. Draghi initially tendered his resignation late last week after a key party in his coalition boycotted a vote in the Senate. Mr. Mattarella didn’t accept the resignation and told Mr. Draghi to determine whether there was sufficient support in Parliament for him to pull together a majority.

The political upheaval comes at a crucial time for Italy, which like the rest of Europe is facing surging inflation and other effects of the war in Ukraine. The government was in the process of approving and implementing measures to help companies and families deal with surging energy costs when the political crisis started.

In another challenge, Italy is likely soon to be facing higher costs to refinance its debt. Mr. Draghi’s successor at the European Central Bank,

Christine Lagarde,

is expected this week to present the central bank’s first interest-rate increase in more than a decade. The long period of low interest rates has allowed Italy to cheaply roll over its debt, which is more than 150% of the country’s yearly economic output.

If Mr. Draghi resigns, Mr. Mattarella could appeal to party leaders to see if they can put together a new parliamentary majority so the country can avoid early elections. On Wednesday, that appeared unlikely, based on comments from party leaders. It would be the first time since the end of World War II that Italy has held a national election in the fall, a period in which Parliament is called to approve the budget for the following year.

Mr. Draghi’s initial resignation last week and its rejection set off a flurry of meetings between the prime minister and party leaders in recent days.

When Mr. Draghi took up his post early last year, Parliament confirmed him with a majority that included parties ranging from far-right populists to a mainstream center-left party. Keeping the eclectic group together has proved challenging for Mr. Draghi.

While the prime minister received several rounds of long applause during his speech, some senators heckled him, earning a rebuke from the president of the Senate.

Dozens of Italian senators took turns responding to Mr. Draghi’s speech on Wednesday. One senator told him it was his duty to remain at his post, while others said he should have resigned long ago because he has never faced the voters in an election.

Mr. Draghi read a list of what he said were the accomplishments achieved during his 17 months as prime minister. He noted Italy’s Covid-19 vaccination campaign, which had been languishing before he arrived. He also mentioned reforms he is pushing through in Italy’s judicial and tax systems.

Italy must pass those reforms to continue getting the money the European Union has earmarked to help countries recover from the pandemic fallout. Italy has already received €46 billion, equivalent to $47 billion, with another €21 billion due to come in the coming weeks.

The parties choosing not to vote on Wednesday include

Matteo Salvini’s

far-right League, which has often wavered in its support for the prime minister and has seen its consensus among voters shrink since it joined Mr. Draghi’s government.

Most senators from the 5 Star Movement, a populist group that set off the crisis last week by not voting for Mr. Draghi, also didn’t vote on Wednesday. 5 Star was the largest party in Parliament, but since the last election in 2018 its support has evaporated and many senators have defected, with a large chunk breaking off to form a new party.

Senators from Forza Italia, which is headed by

Silvio Berlusconi,

the media mogul and former prime minister, also didn’t vote on Wednesday.

The difference in how much interest Italy and Germany pay on their newly issued government bonds initially narrowed after Mr. Draghi’s speech when it seemed he might manage to get a majority of Parliament to support him. That indicated investors were more bullish on Italy’s economic prospects with him at the helm. As the day progressed and it became clear Mr. Draghi was losing support, the difference shot up to above where it had started the day.

Write to Eric Sylvers at eric.sylvers@wsj.com