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UPDATE 1-Merkel allies back Weber to take over ECB helm

Published 02/05/2010, 09:42 AM
Updated 02/05/2010, 09:45 AM

* CSU: euro would be in safe hands with Weber as ECB chief

* CSU says Weber would show euro's stability has priority

(Adds Seehofer, background)

By Paul Carrel

BERLIN, Feb 5 (Reuters) - Bundesbank President Axel Weber has won a significant endorsement to become the next European Central Bank president, gaining the support of the Bavarian sister party of Chancellor Angela Merkel's conservatives.

"Our Bundesbank President Axel Weber is the right man to head the European Central Bank," the general secretary of the Christian Social Union (CSU), Alexander Dobrindt, told the Frankfurter Allgemeine Zeitung (FAZ) newspaper.

"With him (Weber), the euro would be in safe hands," Dobrindt said.

CSU party chairman Horst Seehofer also later backed Weber, telling the online edition of business daily Handelsblatt: "The Bundesbank president would be a very good candidate."

The comments were the first from leaders of one of Germany's three ruling parties on the issue of who should succeed Jean-Claude Trichet, whose tenure ends on Oct. 31, 2011.

Merkel's Christian Democrats share power with the CSU and the business-friendly Free Democrats (FDP).

Dobrindt made his comments on Thursday, the paper said.

Their publication on Friday came as European policymakers tried to reassure markets on the stability of the 16-nation euro zone as investors shed euro assets for a second day running on fears about debt-laden member states like Greece and Portugal.

"As ECB chief, Axel Weber would be a visible symbol that the stability of our currency has absolute priority," Dobrindt said.

German government spokesman Ulrich Wilhelm told a regular news conference on Friday it was too early to discuss who should succeed Trichet.

There are no declared candidates to succeed Trichet but the two leading contenders are widely seen as Weber and Italy's Mario Draghi, 62, a member of the ECB's Governing Council and chairman of the influential Financial Stability Board.

Weber, 52, is an inflation hawk who has been president of the German central bank since 2004. He is also a member of the ECB's Governing Council.

German Economy Minister Rainer Bruederle, an FDP member, said last month Weber was doing an excellent job as Bundesbank president but declined to comment on whether he should succeed Trichet at the ECB's helm.

Shadow-boxing over the ECB presidency is the background to the current race to succeed Greece's Lucas Papademos as vice-president at the end of May.

Euro zone finance ministers are expected to recommend either Yves Mersch of Luxembourg or Portugal's Vitor Constancio for the number two job at the ECB at their next meeting on Feb. 15.

Nominations for the ECB presidency are not expected until early 2011. However, some diplomats think the two top jobs may be shared between northern and southern euro zone countries.

So if Mersch were to get the number two job, Draghi would be seen as front runner for the presidency, while if Constancio were chosen, it could bolster Weber's chances. (Editing by Mike Peacock)

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