Greek prime minister to resign and call for early elections

In a televised address to the nation, Tsipras defended his government's negotiating tactics and said Greece got the best deal possible for its three-year, $96 billion bailout from other eurozone countries.

He said that now that the country has secured its funding, he felt a "deep moral" obligation to lay his actions before the judgment of the Greek people.

Tsipras was due to formally submit his resignation to the country's president. Elections will be held within a month, with government officials saying Sept. 20 would be the likeliest date.

Tsipras and his coalition government made a major U-turn in policy by accepting stringent budget austerity conditions that creditors had demanded in exchange for the bailout program. Tsipras and his Syriza party came to power in January promising to scrap such spending cuts and tax hikes.

He has since said that accepting the terms was the only way to ensure his country remains in the eurozone, which opinion polls have shown the vast majority of his population wants.

Opinion polls have shown Tsipras enjoys far more popular support than his opposition rivals, although no polls have been published since the bailout deal was finalized.

A new mandate would allow him to move away from the hardliners in his party, some of whom have openly advocated leaving the euro and returning to the drachma. The hardliners, including prominent members such as former energy minister Panagiotis Lafazanis and possibly the former finance minister, Yanis Varoufakis, are likely to split from Syriza.

Some analysts took the reports of early elections as an indication that Greece will struggle to implement its bailout.

"Given its anti-austerity roots, the remaining Syriza party will still struggle to implement the demanding bailout conditions, especially in the likely event that Greece sinks further into recession," said Jennifer McKeown, senior European economist at Capital Economics. "And major reforms seem unlikely to be passed in the period running up to the election."

However, initial reaction from European authorities appeared cautiously optimistic. Martin Selmayr, head of the cabinet of European Commission President Jean-Claude Juncker, tweeted that quick elections "can be a way to broaden support for [the bailout] stability support program." 

The Associated Press