Outgoing Italian PM Matteo Renzi has met the country’s president following a heavy defeat in a constitutional referendum on Sunday.

Mr Renzi, who resigned after the vote, and President Sergio Mattarella will be anxious to ease fears of instability and a deeper crisis for Italy’s troubled banking sector.

President Mattarella must either appoint a new PM or trigger elections.

European politicians reacted calmly to the result, saying there was no crisis.

Meanwhile financial markets have stabilised after initial falls on news of Mr Renzi’s defeat.

However, there are concerns about Italy’s fragile economy in the longer term.

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Though Mr Renzi has already met Mr Mattarella, he will not hand in his resignation to him until after a final cabinet meeting due to take place at 18:30 local time (17:30 GMT).

The president may ask him to stay on at least until parliament has passed a budget bill due later this month, but this seems unlikely in view of the scale of his defeat.