Lula backs cenbank chief with eye on 2010 election

Brazil’s central bank chief stoked speculation he may run for governor of Goias state next year when he joined President Luiz Inacio Lula da Silva on Thursday at a ribbon-cutting event there.

Henrique Meirelles, the longest serving central bank president in Brazilian history, has said he has not decided whether to join a political party or run for public office.

But leaders of the right-wing Progressive Party have said he has been talking to them about joining the party, which is part of Lula’s ruling coalition, and running for the governorship of his home state of Goias.

Meirelles tagged along with Lula as he inaugurated a small public works project in the central banker’s hometown of Anapolis, feeding speculation that Meirelles is poised to make a jump into politics.

“I want to tell the people of Anapolis that I am thankful and I owe this comrade (Meirelles) and the government’s economic team the economic stability and respect that Brazil enjoys today in the world,” Lula told a cheering crowd.

Since taking the helm of the central bank in early 2003, Meirelles has resisted political pressure to slash interest rates as far and as fast as sought by prominent government members.

“I have a lot of respect for Meirelles,” said Lula, a former union leader who won investor confidence with market-friendly policies.

“Goias will have an exceptional administrator because Meirelles is very competent,” Lula told a local radio station earlier on Thursday.

The highly popular Lula joked about Meirelles’ former membership in an opposition party and said this time around he should make sure he chooses the right party.

“If Meirelles told me he wants to be candidate for the governorship, I’ll tell him first we need to know for what party and who are our allies, because you need to form an alliance to win elections,” Lula said on Radio Sao Francisco in Anapolis.

Meirelles, who was president of global banking at FleetBoston Financial until 2001, won a seat in Congress in 2002 for the Brazilian Social Democracy Party but turned it down to take the central bank job.

Meirelles said last week he didn’t see a problem joining a political party while in office but that central bank chiefs should step down before launching a political career.

Under Brazilian electoral law, he must join a party one year before the Oct. 2, 2010, election and formalize his candidacy six months before the vote.