At the last meeting, Copom increased the interest rate from 10.75% to 11.25% per year; future BC president noted that recent fiscal policies may have stimulated both consumption and inflation
The director of Monetary Policy at the Central Bank, who will assume the presidency of the institution, indicated that the Selic rate could remain high for a longer period. This need is due to the current economic situation, which presents unemployment at historically low levels and a devaluation of the real. Recently, the Central Bank increased the interest rate from 10.75% to 11.25% per year. In his statements, Galípolo noted that recent fiscal policies may have stimulated both consumption and inflation, resulting in more robust economic growth than expected.
He highlighted that the Central Bank’s priority is to re-anchor the market’s inflationary expectations, as projections for 2025 exceed the official target of 3%. The future president of the Central Bank also guaranteed that the institution has the necessary tools to achieve the inflation target, stating that the possibility of reviewing this target is not on the agenda. Regarding the market’s response to the government’s spending cuts package, he mentioned initial volatility and the importance of clear communication from the Ministry of Finance.
Galípolo highlighted the relevance of a smooth transition in the presidency of the Central Bank, emphasizing the need to maintain institutional stability. He stated that he will continue to follow Roberto Campos Neto’s management, seeking to ensure the continuity of the policies implemented.
*Report produced with the help of AI
Published by Fernando Dias
