NEWSMAKER-Brazil's Tombini is thrown into monetary spotlight

* Tombini would replace Meirelles as head of central bank

* Seen giving continuity to Brazil monetary policy

* Involved in formulation of inflation-targeting regime

* Must prove autonomy, communication skills early on

By Ana Nicolaci da Costa

BRASILIA, Nov 23 (Reuters) - Central bank technocrat Alexandre Tombini, who looks poised to replace Henrique Meirelles at the helm of Brazil's monetary authority, is a seasoned inflation fighter, but will have to prove early on that he can fend off political pressure for looser monetary policy.

Tombini, now in charge of financial system regulation at the bank, is widely expected to continue with Meirelles' interest-rate policy despite a view in the market that he is less hawkish than some past directors who were strong advocates of the bank's inflation-targeting regime. [ID:nN23120336]

As central bank president, he will have to show his independence from the outset as inflation pressures rise and as Meirelles' noisy departure makes markets nervous about the future of monetary policy in Latin America's largest economy.

Investors will look to Tombini to serve as a guarantor of orthodox monetary policies at a time when concerns are mounting about the pace of public spending under Finance Minister Guido Mantega, who will remain in his post when Dilma Rousseff is sworn in as president on New Year's Day.

SEASONED INFLATION FIGHTER

Tombini, who joined the central bank in 1995, was involved in the formulation of Brazil's inflation-targeting regime set up in 1999 -- a legacy analysts say gives him credibility for his new challenge.

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Brazil's key interest rate: r.reuters.com/bem26q

Key facts about Brazil's economy: [ID:nN19135426]

Political risks in Brazil: [ID:nRISKBR]

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Tombini's nomination "is a clear continuation," said Ilan Goldfajn, a former central bank director who worked with Tombini at the decade's start.

"He knows what it's like, he lived through a moment when inflation rose and took time to come down. I think he will have a responsible take on inflation," said Goldfajn, who is now chief economist at Itau Unibanco in Sao Paulo.

Brazil struggled with runaway inflation in the 1980s and 1990s. The central bank's success in taming price pressures won Meirelles widespread recognition at home and broad.

Over the last eight years, Meirelles earned the trust of President Luiz Inacio Lula da Silva, who gave him free rein to set monetary policy even though the central bank does not enjoy formal independence under Brazilian law.

Lula also elevated the head of the central bank to a cabinet-level post, meaning that Meirelles answered directly to the president instead of falling under the Finance Ministry's jurisdiction.

Tombini, 46, will have big shoes to fill. His broad experience at the central bank should give him a head start.

In his current post since April 2006, Tombini has also been the director of the central bank's foreign affairs and special studies departments. He previously worked at the International Monetary Fund and at Brazil's Finance Ministry.

PRESSURE TO LOWER RATES

Some analysts worry he could be less adroit at parrying political pressure than Meirelles, who proved adept at navigating the murky world of Brazilian politics while also establishing a strong rapport with investors.

"He will have to prove himself in this area," said a source close to Tombini, adding that he already had experienced that sort of pressure as part of the monetary policy committee.

The notion that he was a dove was "a bit of an exaggeration" and he "wasn't necessarily the most dovish of the committee," the source said.

But the source added: "He has a vision of monetary policy (and) he will always aim for a lower interest rate."

Tombini's independence will be put to the test early on. With inflation above the center of the government's target, the central bank will be expected to raise its benchmark lending rate -- already at a lofty 10.75 percent -- early in 2011 to rein in consumer prices.

That may cause some unease in the Rousseff administration, which has made lowering interest rates a priority.

Another challenge for Tombini will be to become a skillful communicator to reconcile differing views within the bank and bring the government and society on board with decisions.

"He is a shy guy, an introvert," said one economist who knows him well professionally but asked not to be named.

"I don't know whether he has (what it takes) to be the head of the central bank, which basically requires you to convince society of what needs or does not need to be done." (Editing by Todd Benson and Jan Paschal)