Reports in the Italian media suggesting that Prime Minister Silvio Berlusconi might be forced to resign on Monday have sent some markets soaring after early loses.
The news, reported in the Italian newspaper Il Foglio and other outlets, suggests that the controversial leader may be forced to leave office ahead of a crucial vote on public finances.
Berlusconi later took to Facebook to deny the rumours, saying that talk of his resignation was "unfounded".
One of the journalists behind the rumours of his departure said via Twitter that he changed his mind after a lunch in Milan with his children by his first marriage and the chairman of his Mediaset TV company.
However, the Italian markets had already responded to the news - moving sharply up by nearly 2.5% before midday before dropping again after the denial.
In further bad news for Berlusconi the Italian government's cost of borrowing also hit record highs for the euro era, with the interest rate on Italian ten-year bonds rising above 6.6%.
That is close to the 7% level at at which Ireland, Greece and Portugal were forced to accept bailouts.
Unfortunately for Italy, neither the European Financial Stability Facility (EFSF) nor the International Monetary Fund (IMF) can cover the scale of its debt - making the vote on public finances even more critical.
Even as the prime minister denied he was about to resign sources in Italy told the Huffington Post UK that he "was on the brink".
"Anything could happen but the word in the street is that he either resigns today or looses tomorrow's vote and is forced to step down," said one journalist.
Two of Berlusconi's allies defected to the opposition last week, while a third - Gabriella Carlucci - announced that she was leaving the PM's People of Freedom Party on Sunday evening.
Six other Berlusconi allies have called for Berlusconi to resign in a letter to newspaper Corriere della Sera, and as many as 30 MPs are threatening to vote against Berlusconi's coalition on Tuesday, according to the BBC.
If Berlusconi loses that vote he will face a confidence vote on Thursday, and if he loses that then he will be forced to go.
The Guardian reported that the Il Corriere della Sera newspaper gave Berlusconi just a 5% chance of surviving the country's debt crisis.
The crisis in Italy comes after a week in which Greek prime minister George Papandreou was forced to step down after eurozone leaders threatened to scrap a proposed bailout deal.