**The governing Socialist Party of Jose Socrates is set to retain power in Portugal’s elections, exit polls say.**The polls indicate that the party has won about 40% of the vote, but failed to retain its absolute majority in parliament.
Challenger Manuela Ferreira Leite, of the centre-right Social Democrats, is forecast to win under 30% of the vote.
Mr Socrates promised to invest heavily in public work projects to tackle Portugal’s rising unemployment.
Correspondents say if Mr Socrates wins the election he faces hard choices about whether to try to form a coalition or rule with a minority government.
The exit polls have been published by Portugal’s three national television broadcasters.
A spokesman for the Socialist Party welcomed the projections as pointing to “a clear victory”.