Speaking in Merida, southern Mexico, President Clinton said Hillary Rodham Clinton would make a "terrific" senator and he would back any decision by her to run.

His remarks instantly fired the Washington rumour-mill that Hillary Clinton is jockeying for a key position.

But the president added that the first lady had not begun to make up her mind.

He said: "I think she would be terrific in the Senate ... but it's her decision to make. I will support whatever decision she makes enthusiastically."

New York vacancy

President Clinton made the remarks at a news conference during a meeting with Mexican President Ernesto Zedillo.

His support gives credence to rising speculation that Mrs Clinton might run in 2000 for the New York seat which will be up for grabs after the retirement of Democratic Senator Daniel Patrick Moynihan.

In polls, Hillary Clinton has beaten her New York Mayor rival

Mrs Clinton travelled to Mexico with the president and made a rare appearance in the press cabin of Air Force One on Sunday when she joined her husband in handing out Valentine's Day chocolates.

The president said the idea of running for the Senate was not Mrs Clinton's. "I think it's important that everyone understands that people in New York started calling her. I don't think it ever occurred to her before a lot of people started calling and asking her to do it," he said.

New York Democrats have been eager to find a strong candidate to face the expected Republican Senate nominee, New York City Mayor Rudolph Giuliani. Mrs Clinton has beaten Mr Giuliani in early polls on a possible contest.

On Sunday, Senator Moynihan said New York could use some of Mrs Clinton's "magnificent, young, bright, able, Illinois-Arkansas enthusiasm."

He added: "She'd be welcome and she'd win."

Life after the trial

The US president made a veiled reference to his impeachment battle which ended in a Senate acquittal on Friday, saying that the first lady had been too busy to think about a Senate bid.

"I'm sure you'll understand she hasn't had anything like adequate time to talk to the people who think she should do this, much less the people who think perhaps she shouldn't. She just hasn't had time to deal with it," he said.

Wanting to be useful

Rumours have circulated that Mrs Clinton would meet New York's other senator, Democrat Charles Schumer, within the next two weeks, to discuss a bid.

The first lady's spokeswoman, Marsha Berry, has said Mrs Clinton would begin thinking about a run now that the Senate trial is over.

The president, whose second and final term ends in January 2001, said he and Mrs Clinton both wanted to continue in public service.