Minister offers resignation amid political scandal

The architect of Brazil’s economic recovery and market-friendly fiscal policy offered his resignation today after becoming caught up in a political scandal, Brazil’s Finance Ministry said.

Finance Minister Antonio Palocci was sending a resignation letter tonight to President Luiz Inacio Lula da Silva outlining his reasons, the ministry said in a statement.

Palocci faces accusations he frequented a house in Brasilia where lobbyists held parties with prostitutes and money arrived by the suitcase, possibly for political payoffs.

He denies ever setting foot in the house, but uncertainty about his future in Silva’s administration rocked financial markets today.