Talks on forming a three-party coalition government in Austria collapsed after the smallest party NEOS withdrew from negotiations. However, the remaining two parties have confirmed their intention to continue discussions.

The smallest of three parties in talks to form Austria's next government unexpectedly quit those negotiations on Friday, throwing into disarray an effort to form a centrist ruling coalition without the far-right Freedom Party (FPO).

The Neos party's abrupt withdrawal from Austrian coalition talks has caused political uncertainty, strengthening the far-right Freedom Party's position. Opinion polls show increased support for the FPO,

Talks on forming a new three-party government in Austria have collapsed as the smallest of the prospective coalition partners pulled the plug on the negotiations.

The party was in monthslong talks with the Social Democrats and Chancellor Karl Nehammer's conservative People's Party. The collapse of the talks give hope to the far right FPÖ, which came first in last year's election.

Representatives of the conservative Austrian People's Party (ÖVP) and the Social Democrats (SPÖ) met in the nation's chancellery for talks on Saturday after the failure of their discussions with a further party for a three-way coalition.

VIENNA (Reuters) -Talks between the two biggest centrist parties in Austria on forming a coalition government without the far-right Freedom Party (FPO) have collapsed, Chancellor Karl Nehammer said on Saturday,

Collapse underlines difficulty of forming governments in European countries where far-right on rise but parties refuse to partner with them.

Austrian Chancellor Karl Nehammer said he planned to resign in the coming days after talks between his conservative party and the Social Democrats to form a new government collapsed on Saturday, casting the nation into a political crisis.