MILAN (AP) — Italians are voting in a referendum on constitutional reforms that is being closely watched abroad to see if Italy is the next country to reject the political status quo.

Premier Matteo Renzi says he will resign if the reforms are rejected in Sunday's vote, and opposition politicians have vowed to press for a new government if voters reject the proposed constitutional changes.

The risk of political instability has triggered market reaction before the vote, with bank stocks sinking and the borrowing costs on sovereign debt rising.

The referendum aims to streamline Italy's cumbersome lawmaking process by reducing the powers of the Senate while also removing some key decision-making powers from regions.

Polls are open Sunday for 16 hours starting at 7 a.m. (0600 GMT).