Michel Temer: Brazil's former president arrested just two months after far-right Bolsonaro took power

Move comes as part of sprawling police probe into alleged graft in construction of nuclear plant

Michel Temer has been arrested in Rio de Janeiro (EPA)

Brazil's former president Michel Temer has reportedly been arrested as part of a sweeping anti-corruption investigation known as "Car Wash".

He was detained in Rio de Janeiro on Thursday morning in a sprawling probe of alleged graft in the construction of nuclear plant Angra 3, prosecutors said. His lawyer confirmed the arrest.

Mr Temer was president from 2016 to 2018, taking office following the impeachment of Dilma Rousseff, for whom he served as vice-president for six years.

He was succeeded this year by Jair Bolsonaro, a far-right former military officer who is himself implicated in a separate corruption scandal.

The arrest, which has rattled Brazil's political class, saw Brazil's currency slip as much as 1 per cent on the news and the Bovespa stock index fell 1.5 per cent, as the prospect of new arrests of prominent politicians threatened to delay debate over sweeping economic reforms.

According to O Globo, Mr Temer was arrested by officers who are also seeking former energy minister Moreira Franco.

The warrants were issued by a judge in the 7th Federal Criminal Court of Rio on Wednesday, the newspaper reported.

Mr Temer, a longtime legislator, was hit with corruption charges during his presidency which were blocked by allies in the lower house Congress. The legislative body must authorise charges against a sitting president.

Mr Temer has repeatedly denied any wrongdoing.