This afternoon the Latvian Prime Minister Godmanis announced that he is resigning after the two largest parties in the coalition had called for his resignation. A week ago President Zatler said he had lost trust in Godmanis and his government. Early elections now look like the most likely outcome - even though President Zatler today said that talks will start on Monday to try to form a new government.
The resignation of Godmanis is a clear escalation of the political crisis that has hit Latvia, and there is little doubt that this could lead to serious speculation about the government's austerity measures as part of the IMF-led rescue package that the country received in December.
