“Zapatero has expressed his wish that Alfredo Perez Rubalcaba be the candidate of the Socialist Party,” the deputy secretary general of the Socialist Party Jose Blanco told a news conference.

He said Rubalcaba, 59, who is also interior minister and one of the most powerful figures in government, also has the support of regional party leaders who met with Zapatero earlier Friday.

Rubalcaba is the candidate that “people want most, the best, whom our opponents fear most and who can respond to the challenges of Spaniards.”

He said a Socialist Party (PSOE) federal committee would meet on Saturday, and if there is more than one candidate a vote would be held on June 26.

Zapatero announced last month he would not seek a third mandate, but would remain in office until the next elections, scheduled by March 2012.

After eight years in opposition, the conservative Popular Party of Mariano Rajoy is widely expected to romp into office in the elections amid popular anger over the economic crisis and soaring unemployment.

The way for Rubalcaba to lead the party was opened when his only serious rival, Defence Minister Carme Chacon, 40 and a rising star in the party, said Thursday she would not stand.

Chacon said she had withdrawn to avoid an internal spat.

Infighting had erupted among the Socialists over how to choose a new leader after the party’s humiliating rout in local elections on Sunday.

Zapatero had called for internal primaries in which all 220,000 party members have a say on their next leader.

But, at the last moment, dissenters called for a congress of between 500 and 2,000 elected party members to rethink party strategy and decide on a single candidate.

The party’s leader in the Basque Country, Patxi Lopez, called on Tuesday for a congress of elected party members that would decide on one candidate for the leadership.

The congress would give time “to launch a debate within our party that involves the entire membership to correct mistakes and define … a project to revitalize the values of the left, to make progress in overcoming the economic crisis and job creation,” he said.

Blanco said Friday that the party would hold a conference in September to “debate ideas” in line with proposal of Lopez.

Spain’s Socialists received an unprecedented mauling in regional and municipal elections by the PP.

Support for the government collapsed in the face of the beleaguered economy, the highest unemployment rate in the developed world at more than 21 percent and huge week-long street protests.

Demonstrators have occupied city squares throughout the country for almosty two weeks, refusing to budge as they accused the major Spanish parties of leading Spain to economic ruin.

In a broad government reshuffle last October, Zapatero named Rubalcaba as his new deputy while maintaining him in the job of interior minister, where he has led Madrid’s successful fight against the Basque separatist group ETA.

Polls consistently show Rubalcaba, who served as education minister and minister for the presidency under Felipe Gonzalez in a previous Socialist government, is the most respected member of Zapatero’s cabinet.

Zapatero at the time described him as having “outstanding qualities for politics, for explaining the actions of the government and for the coordination of the government’s actions.”