Romania's ruling Social Democrats (PSD) party lost their parliamentary majority on Monday after a junior ally quit the government over policy, leaving the party vulnerable to a confidence vote, Euronews reports.

The Liberal Party ALDE backed out of the alliance two days after leader Calin Popescu Tariceanu lost a bid to become the sole pro-government candidate in the presidential election scheduled for November. The PSD, instead, chose their leader Prime Minister Viorica Dancila to go against incumbent Klaus Iohannis.

ALDE's move would normally trigger an early ballot but the fragmented opposition might prefer to wait the full term out, said analysts.

"I don't see many (other parties) rushing to take over now," said political commentator Cristian Patrasconiu. "(Waiting for the election) is the most rational political stance."

EU and US authorities have been critical of the governing alliance for an overhaul of Romania's judiciary that they say threatens the rule of law, and for watering down anti-graft legislation.

Dancila said the PSD would continue to govern: "The important thing is to not disappoint our voters who trusted us in 2016 (national) elections," she said on her Facebook page.

But ALDE's pull-out leaves the PSD 25 seats short of a parliamentary majority, which could refrain policymaking, forcing her to negotiate legislation on a bill-by-bill basis.

Dancila has 45 days to ask parliament for a vote of confidence and, in the meantime, needs to find new appointees for three ALDE-held ministerial posts and will seek to ally with other political groupings, probably including the ethnic Hungarian UDMR.