Greek Prime Minister George Papandreou on Monday dropped his threat to call a snap election after his Socialist Party avoided a heavy defeat in the first round of regional elections.
The Socialists currently lead in seven of Greece’s 13 electoral regions. Turnout was 60 percent.
Papandreou said the results gave him a renewed mandate for his planned austerity measures.
“We know that change is not easy. But it was for this change that the Greek people brought us to power a year ago. And today it again confirmed that it wants this change,” he said, adding “we will continue with our task tomorrow.”
The austerity plan formed part of the 110-billion-euro bailout agreed with the IMF and the EU in May.
Under the agreement, Greece must implement deep spending cuts, reform pensions and liberalise a number of ‘closed-shop’ professions.
The aim is to reduce the country’s fiscal deficit and pay off its sovereign debt.
Investors feared the threat of a snap election and a new government would see some of those promises broken.
The second round of the regional poll takes place on November 14.