MADRID (Reuters) - Spain's Socialist party and liberal newcomer Ciudadanos were close to striking a deal on Tuesday over a coalition government, both parties said, although their alliance would fall well short of a parliamentary majority.
The move was seen by political analysts as an attempt by the two parties to put pressure on the ruling conservative People's Party (PP) to abstain in a vote of confidence on the Socialist leader, Pedro Sanchez, scheduled for next Wednesday.
Winning that vote would make Sanchez prime minister. But the PP has said many times that it would vote against both such a coalition and against Sanchez. Instead, it will try to win support for a new term for acting Prime Minister Mariano Rajoy, the PP leader.
To be elected prime minister, Sanchez needs an absolute majority on March 2 or a simple majority of seats in a second vote that would take place on March 5.
A Dec. 20 national election left all Spain's political parties short of a majority in the 350-seat lower house. The PP won 123 seats, the Socialists 90, anti-austerity Podemos 69 and Ciudadanos 40.
Since a pact between the Socialists and Ciudadanos would provide only 130 seats, it would need at least the PP or Podemos and several other parties to abstain.
Rajoy had said in January he lacked support to try and form a government, but earlier this week he said he would try to lead a "grand coalition" with the Socialists and Ciudadanos. Failing that, he said, a new election would probably be necessary.
Podemos leader Pablo Iglesias also said on Tuesday his party would vote against a coalition between the Socialists and Ciudadanos and offered instead to form a left-wing alliance with the Socialist party, two other leftist groups and three regional parties from the Basque country and Catalonia.
The Socialists have held talks with Podemos and other parties to try and form such a coalition in parallel to their discussions with Ciudadanos, but the negotiations have made little headway so far.
Once the first investiture vote has taken place on March 2, political parties will have a maximum of two months to reach a parliamentary majority and elect a prime minister.
If they fail, a new election would have to be called. Rajoy said last week that would probably take place on June 26.
(Reporting by Carlos Ruano and Blanca Rodriguez, writing by Julien Toyer)