UPDATE 2-Brazil’s Lula to ease transition, fight currency rally

* Lula ready ‘to fight’ over currency at G20 meeting

* Lula plans no unpopular measures in remaining two months

* Rousseff eyeing minimum wage hike, ongoing land reform

* Rousseff in no hurry to form govt, no tension with ally
(Adds comments from Rousseff, detail, context, byline)

By Leonardo Goy

BRASILIA, Nov 3 (BestGrowthStock) – Brazilian President Luiz Inacio
Lula da Silva said on Wednesday he would do what it takes to
ensure a smooth transition for his successor and to prevent the
country’s currency (BRBY: ) from overvaluing.

Dilma Rousseff, a former chief of staff under Lula, won an
overwhelming majority in Sunday’s presidential election and
will take office on Jan.1.

Flanked by Rousseff, Lula said that he would go to the G20
meeting of heads of state in Korea next week ready to fight
against a currency war between China and the United States.

“We will ensure taking all necessary measures to not allow
our currency to become overvalued,” Lula said.

The real is trading at close to a two-year high, renewing
demands by struggling exporters for government action.

Rousseff, who will accompany Lula to the G20 summit, echoed
those words and called for countries to work together to
prevent the currency dispute from escalating.

“In a situation like this, individual solutions don’t
work,” said Rousseff.
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Special report on Rousseff http://link.reuters.com/fab25p

Rousseff’s economic policies [ID:nN31100256]

Political risks in Brazil [ID:nRISKBR]

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Lula made clear he would use his remaining two months in
office to clear the way for his chosen successor, who has never
been elected to public office before. He said he would tackle a
$4 billion to $6 billion jet fighter deal and the nomination of
a Supreme Court justice next week.

BUDGET MEASURES

Pre-election spending has put strain on public coffers this
year and local media reported on Tuesday that Lula is readying
austerity measures aimed at ensuring a smoother start for
Rousseff, including a smaller wage increase for civil servants
and budget cuts. [ID:nN02201995]

But Lula ruled out plans for unpopular measures before his
term ends on Dec. 31, suggesting that any fiscal measures in
coming weeks would be gradual and not austere.

“There are no unpopular measures ahead. There’s no need for
them and neither I nor Dilma want that to happen,” Lula said.

After reiterating her commitment to market-friendly
policies in recent days, Rousseff appeared to play more to her
party’s traditional supporters — labor unions and peasant
movements. She said there was plenty of land to continue to
distribute it to poor peasants and that she was studying ways
to increase minimum wages next year.

“We’re evaluating … if it is possible to make that
adjustment,” an upbeat Rousseff told reporters after Lula left
an improvised news conference to give her center stage.

In a effort to play down expectations that he will play a
key role in the next administration, he said that Rousseff
alone would decide who will be in her government.

Rousseff has named a transition team but will rest from a
long campaign until Monday.

The career civil servant denied media reports that her
coalition partner, the centrist PMDB party, was upset for
having initially been excluded from the transition team.

“They are participating in the transition like they did in
the campaign,” said Rousseff, who will seek to prevent a power
struggle among allies as she forges her Cabinet.

(Writing by Raymond Colitt: Editing by Doina Chiacu)

UPDATE 2-Brazil’s Lula to ease transition, fight currency rally