11 May 2012 Last updated at 06:43 ET
Pasok leader Evangelos Venizelos said talks with the Democratic Left went well
Greece's Pasok leader Evangelos Venizelos seeks unity deal / BBC
Pasok leader Evangelos Venizelos said talks with the Democratic Left went well
The leader of Greece's main socialist party, Evangelos Venizelos, is holding a series of talks on forming a coalition to deal with the debt crisis.
Mr Venizelos is the third party head to try and reach a deal since Sunday's election produced a hung parliament.
Earlier, observers said there was some hope of a deal after Mr Venizelos met the head of a smaller, left-wing party.
The uncertainty over whether Greece will repay its loans is threatening the entire eurozone.
The big winner in the polls was the Syriza party, which has rejected the terms of a bailout needed for Greece to continue to meet its repayments.
German officials have kept up the pressure on the Greek politicians by warning that Greece must stick to the terms of the bailout and saying that the eurozone could survive if Greece had to leave the currency union.
Pasok head Mr Venizelos met Antonis Samaras, who leads the centre-right New Democracy party, on Friday morning, without making any public comment afterwards.
He is later due to hold talks with Syriza head Alexis Tsipras.
If the latest attempts fail, the president must ask all political leaders to make one final effort to form a government before calling fresh elections.
An opinion poll released late on Thursday predicts that Syriza would be the largest party if new elections were held.
The BBC's Mark Lowen in Athens says this poll may jolt the New Democracy and Pasok leaders into action. They formed the outgoing coalition.
Pasok dominated Greek politics for most of the past four decades, but saw its support slashed - coming third with just 41 seats in the 300-seat parliament.
Our correspondent says the party is deeply unpopular - seen as the architects of austerity, and tainted with allegations of corruption.
'Slim chance'
After meeting Democratic Left leader Fotis Kouvelis on Thursday, Mr Venizelos said a "first step" had been made.
Our correspondent said this meeting seemed to provide the framework of an agreement for a coalition that would lighten the austerity measures in Greece, renegotiate parts of the loan agreement but try to keep the country in the euro.
If they can persuade New Democracy to accept the plan, those three parties would have enough seats to form a government.
"We are fighting for a government to exist - and there is still hope this can happen," Mr Samaras told his deputies in a speech after meeting Mr Venizelos.
He said Syriza was being irresponsible but also hinted that their support may be needed to ensure that any government was "durable".
New Democracy won the most votes, taking 108 seats, but he was unable to woo other party leaders.
Left-wing coalition Syriza was the second biggest party, with 52 seats, but its leader also failed to form a government because of his insistence on rejecting austerity measures demanded by the EU and IMF.
Pasok and New Democracy between them have 149 seats, two short of a majority. The Democratic Left party has 19 seats.
As the prospect of fresh elections loomed, Thursday's opinion poll put Syriza in first place with nearly 28% of the vote - up from 16.8% - winning 128 seats.
The Marc survey for private Alpha TV put New Democracy in second place with 20.3% and 57 seats, and Pasok third with 12.6% of the vote and 36 seats.
The political deadlock has brought warnings from European leaders that debt-laden Greece could be thrown out of the euro if it does not stick to tough spending cuts and economic reforms.
On Friday, German Foreign Minister Guido Westerwelle told parliament: "The future of Greece in the eurozone lies in the hands of Greece.
"We want to and we will help Greece, but Greece has to be ready to accept help. If Greece strays from the agreed reform path, then the payment of further aid tranches won't be possible. Solidarity is not a one-way street," he said.
German Finance Minister Wolfgang Schaeuble told the Rheinische Post newspaper that Europe "won't sink" if Greece left the eurozone.
Athens is due to approve fresh budget cuts worth 14.5bn euros (£11.6bn; $18.8bn) next month, in return for financial help from the EU and IMF worth a total of 240bn euros.
Both Germany and the EU have made clear they expect Athens to honour its commitments.
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