Macri runs confident campaign in Argentina's run-off election

BUENOS AIRES (Reuters) - After turning Argentina's presidential race on its head, opposition challenger Mauricio Macri is the new favourite to win, confident enough to stand firm even on economic policies that have alienated some voters.

It is a stark contrast to bruised ruling party candidate Daniel Scioli, who has resorted to attack ads against Macri while offering a torrent of last-gasp policy pledges ahead of the Nov. 22 run-off vote.

Defying polls that showed him in a distant second place, Macri had a surprisingly strong showing in the first round of voting last month.

He came in just 3 percentage points behind Scioli of the ruling Front for Victory party, forcing a run-off, and he has since overtaken his rival in polls.

The centre-right mayor of Buenos Aires is not hiding from pro-market proposals that he says will underpin sustainable growth but are dismissed by Scioli as a return to right-wing policies of the 1990s that led to a devastating depression.

"We have to put an end to controls on the currency," Macri told a chat show host this week, standing firm on a pledge that his opponent says will send prices spiralling higher and eat into incomes.

A month ago, Macri appeared drained and seemingly lacked the belly to fight. Foreign diplomats quietly questioned whether he shared Scioli's conviction he could handle the presidency.

Criss-crossing the country of 43 million people, he now looks confident and energized, and is shaking off his image as a politician uncomfortable hugging voters in the street.

His call for a clean break from Fernandez's brand of leftist populism strikes a chord with many voters who are weary of her economic nationalism and confrontational style.

An opinion poll this week by consultancy group Management & Fit showed Macri with the support of 51.8 percent of voters and Scioli trailing on 43.6 percent.

Asked if tweaks would be made to Macri's campaign in the final run-up to the second round, a campaign insider said: "Nothing changes, our campaign policies will remain the same."

'FEAR'

Scioli has the support of Fernandez loyalists but at the cost of scaring off other voters fed up with high inflation, import restrictions and weak economic growth.

Now trailing, Scioli has sought to demonize Macri as a neo-liberal bent on putting big business and the wealthy before the lower classes.

Scioli has fired near-daily salvos at his conservative challenger's promise to unwind capital controls, warning of a "megadevaluation" that will erode salaries and welfare benefits.

"Your vote is a choice between the state and the public sector, or the markets and private sector, which will abandon workers, pensioners, students, the poor and the middle class," Scioli told voters in Lugano, a low-income neighbourhood on the fringe of the capital Buenos Aires.

Macri's team admits the hard-to-access official exchange rate will weaken when controls are lifted, but says other rates Argentines pay when using a credit card abroad or buying dollars locally will strengthen as investor confidence is restored.

Scioli, who says monetary reforms need to be gradual to ensure the poor are not hit hardest, scoffs at the notion he is dependent on fear-mongering to win votes.

"The only one creating fear is Macri with his policy proposals," Scioli told a local radio station, stressing that he would not oversee a sharp devaluation.

In one of the most tightly fought presidential elections since democracy was restored in 1983, analysts say Scioli's rhetoric could resonate among less affluent voters.

More than 10 percent of voters remain undecided, some polls show, meaning Scioli could regain the lead with a late surge.

Both candidates' prospects for winning the run-off hinge on winning over the 5 million supporters of centrist Sergio Massa, who placed third on Oct. 25.

Scioli now promises to hike pensions, scrap export taxes on wheat and corn, overhaul the discredited statistics agency and send in the army to tackle drug-trafficking gangs - pledges that come straight out of Massa's own policy blueprint.

In a new spot advert, Scioli reaches out to voters with the words "I know some of you are angry", widely interpreted as an attempt to distance himself from Fernandez.

Macri, meanwhile has refrained from offering sweeteners to Massa's voters, buoyed perhaps by strong nods in his direction from the dissident Peronist lawmaker.

"Making sweeping changes to your campaign strategy is at times to underestimate the voter," said Marcos Pena, Macri's chief campaign strategist.

Opinion polls indicate voters are not convinced by Scioli's overtures. The Management & Fit survey showed Massa's supporters voting in favour of Macri by a ratio of almost three to one

"The discourse of change is with Macri," said Francisco Resnicoff, a political risk specialist at Cefeidas Group. "Macri has done a good job as presenting himself as the future. He took that space away from Scioli."

(Additional reporting by Maximiliano Rizzi; Editing by Kieran Murray)