subject to their blackmail,” Centre Party leader Annie Loof told reporters after the vote.

Both Lofven and Kristersson have ruled out sitting in a government together.

The Sweden Democrats, ostracized by all other parties due to their fierce nationalism and early links to white supremacist activists, hold the whip hand. They have said they would reject any government that did not give them guarantees over policy, particularly on tighter immigration curbs.

Liberal leader Jan Bjorklund called for talks with the Greens, part of Lofven’s outgoing government. But that has been rejected by the Greens as well as the Moderates, and a coalition of the Alliance and the Greens would still lack a parliamentary majority.

With no sign of compromise, a snap election is looking more likely. But that could easily return asimilar result and simply delay forming a new government.

The impasse is likely to have negative effects the longer it lingers. A budget to be presented by acting Finance Minister Magdalena Andersson on Thursday will freeze new spending and is likely to hit some local authorities hard.

Analysts also say the deadlock could damage faith in the democratic process, potentially boosting the Sweden Democrats.

Even when a new government is in place, it will struggle to push through major policy initiatives, meaning urgent reforms, for example in the housing market, are likely to be delayed.

Three more parliamentary votes to choose a new prime minister can be held before new elections must be called.