The meetings, which will be held in 2025, will already have Gabriel Galípolo as president of the monetary authority and the new body of directors, with the majority appointed by the current government
After raising the rate by 1 percentage point, from 11.25% to 12.25% per year this Wednesday (11), the Central Bank’s Monetary Policy Committee, (), indicated making two more readjustments of the same magnitude in their next meetings, if the scenario expected by the collegiate is confirmed. The meetings, which will be held in 2025, will already have Gabriel Galípolo as president of the monetary authority and the new body of directors, with the majority appointed by the current government.
“Faced with a more adverse scenario for inflation convergence, the Committee foresees, if the expected scenario is confirmed, adjustments of the same magnitude in the next two meetings. The total magnitude of the monetary tightening cycle will be dictated by the firm commitment to convergence of inflation to the target and will depend on the evolution of inflation dynamics, especially the components most sensitive to economic activity and monetary policy, inflation projections, expectations of inflation, the output gap and the balance of risks”, says the statement.
The Copom has not indicated guidance since March of this year, when it indicated that it would make a reduction of 0.50 pp. at the May meeting, which did not occur. At that meeting, the board “split”: it made a cut of 0.25 pp in a split decision, which pitted the directors appointed by Luiz Inácio Lula da Silva against those who had already been on the board under other governments, including those appointed by Jair Bolsonaro.
The board justified the decision to raise the Selic rate to 12.25% per year as being compatible with the strategy of inflation convergence around the target over the relevant horizon. “Without prejudice to its fundamental objective of ensuring price stability, this decision also implies smoothing fluctuations in the level of economic activity and promoting full employment”, says the text.
*With information from Estadão Conteúdo
Posted by Carolina Ferreira
