President Shimon Peres is likely to ask Foreign Minister Tzipi Livni to try to form a new coalition government, a Peres spokeswoman said yesterday, a day after Prime minister Ehud Olmert resigned. Peres met parliamentary faction leaders to sound them out on their choices for prime minister or whether they prefer an early election ahead of a national ballot due in 2010.

The political uncertainty has dimmed even further prospects of an Israeli-Palestinian peace deal, which the United States had hoped Olmert and Palestinian President Mahmoud Abbas could achieve this year. ?(Peres) is meeting with many factions today, and something might change, so I can?t say for sure he will choose Tzipi Livni, but that?s how it?s looking,? Peres spokeswoman Ayelet Frish told Army Radio.

Olmert, who could face criminal indictment in corruption probes, submitted his resignation to Peres on Sunday, but will remain in office until a new government is in place. He was replaced as the head of the ruling Kadima party by Livni, who narrowly won an internal election on Wednesday. If Peres gives her the nod, she will have 42 days to build a coalition and become Israel?s first woman prime minister since Golda Meir in the 1970s. Failure would likely lead to a parliamentary election.

Since Olmert?s resignation, Peres has met representatives of the four largest parties ? Kadima, Labour, Likud and Shas ? and will hold talks with the remaining nine factions yesterday.