Leaders of small, centrist parties in Italy have been wooing Monti to come onto their ticket. Before Monday, Monti had ruled out running for office but indicated he might accept some role in government if asked.
European leaders, who collectively sighed in relief when Monti was appointed, did not hide their concern over news that he was leaving prematurely and that Berlusconi, with his personal scandals and legal woes, was back in the political fray.
"Italy has two-thirds of the route of reform behind it, but the final third is now decisive and so a halt to the policy of reform would entail not just a significant weakening of Italy, but also could bring new turbulence to Europe," German Foreign Minister Guido Westerwelle told reporters in Brussels.
Outside of Italy, European financial markets eked out small gains at the end of the day, as some investors reassessed their concerns over Italy and focused instead on improvements in U.S. budget talks, which are critical to the health of the U.S. — and global — economy.
Berlusconi's judicial woes and not just his political ambitions were in the spotlight Monday. He is on trial in Milan for allegedly paying for sex with an underage Moroccan woman and then using his office to cover it up. He and the woman deny the accusations.
The woman, Karima el-Mahroug, was due to testify Monday but didn't show up, telling her lawyer in a text message that she was out of the country and giving no indication when she would return, news reports said.
Prosecutor Ilda Boccassini contended in court that el-Mahroug, known as Ruby, had been kept away by Berlusconi's defense to delay the trial until after elections. But Berlusconi attorney Niccolo Ghedini denied that, calling the prosecutor's contention "defamatory."
Geir Moulson contributed from Berlin.
Follow Nicole Winfield at www.twitter.com/nwinfiel
Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.