Justice Minister Moro resigns in new blow to Bolsonaro government

Sergio Moro, the former judge who rose to fame as the face of Brazil’s largest anti-corruption probe, resigned from his post as justice minister amid what he saw as political interference, dealing a blow to the government of President Jair Bolsonaro.

“It’s my duty to protect the federal police, and I tried to seek alternatives to avoid a political crisis amid a pandemic,” he said at a press conference Brasilia to explain his decision. “I’ll start packing my things and tender my letter of resignation. I can’t go on without ensuring the federal police its autonomy.”

Brazilian markets sank amid concern the departure would exacerbate political risk in Latin America’s largest economy. The currency sank more than 3 percent to as low as 5.7106 per US dollar, by far the worst performer among emerging markets on Friday. Stocks fell 7 percent.

Precipitating his move was Bolsonaro’s firing of Federal Police chief Mauricio Valeixo, Moro’s right-hand man at the institution that’s akin to the US Federal Bureau of Investigation. Moro said the pressure to replace Valeixo started in the second half of last year, without a clear reason. The insistence from Bolsonaro on the change made clear the move was political interference, Moro said.

“The change is not a problem. The question is why,” he said. The president wanted the police to share reports and data with him, which would violate its autonomy, he added. “It’s not true he asked to leave. I couldn’t accept his departure.”

Moro and Valeixo worked together at the so-called Carwash probe that landed some of Brazil’s top business executives and political leaders behind bars, including former President Luiz Inacio Lula da Silva. Since then, Moro became a national hero for many Brazilians. His approval ratings are higher than those of the president, which makes him a potential contender in the 2022 presidential election.

His departure is likely to cost Bolsonaro part of his supporters who nearly unconditionally back the minister, often depicted as a super hero in anti-corruption demonstrations. It could also be an attempt to reshape his cabinet with more like-minded people, following his decision to fire Luiz Henrique Mandetta from the health ministry last week.

Bolsonaro “still has his support base, but absolutely he will lose some of them because of this,” said Mauricio Santoro, professor of political science at the State University of Rio de Janeiro.

The Brazilian real extended losses as traders said Moro’s departure would exacerbate political risk in Latin America’s largest economy.