"Rumours of my resignation are baseless and I do not understand how they started circulating," Berlusconi was quoted as telling his aides.
Fabrizio Cicchitto, leader of Berlusconi's People of Freedom party in parliament, said: "I spoke to prime minister Berlusconi a short time ago and he told me that the rumours about his resignation are without foundation."
Stock markets earlier rallied on rumours that Berlusconi's resignation was imminent, while long-term borrowing rates hit record highs.
The yield on 10-year government bonds reached 6.596 percent on Monday compared to 6.371 percent late on Friday, indicating a peak in investor fears.
(Published 07 November 2011, 13:37 IST)
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