Haddad says he does not see room to climb more interest and points out that inflation is falling
Finance Minister Fernando Haddad said on Friday, 27, he no longer sees room for the economy’s reference interest, and that the Central Bank (BC) will start to calibrate at some point when he will cut Selic again. “By this time, I no longer see room to increase the interest rate, and I believe that the Central Bank will have to calibrate the moment of the cutting cycle. I do not know when it will happen, but there is a lot of good happening,” the minister said during an interview with GloboNews.
Haddad stressed that inflation is down, even marking deflation in the food and beverage group in the last IPCA-15 measurement, while the Federal Reserve with the possibility of resuming the interest cutting cycle in the United States.
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Asked during the interview why the government does not attack BC President Gabriel Galipolo -nominated by Lula and who kept the interest rate -as he did with Roberto Campos Neto, Haddad replied that he had only two moments of disagreement with the former BC chief. The first of these was around the beginning of the last interest cutting cycle that, for Haddad, should have started before.
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The second divergence was in the change of Forward Guidance Announced by Campos Neto at a meeting with investors promoted by XP in Washington in April last year. Until that event, the market operated with the signaling that the Monetary Policy Committee (Copom) would continue to cut interest rates at a 0.5 percentage point. Campos Neto, however, said at that meeting that uncertainties could lead the BC to review the signaling, which led investors to reduce the pace of monetary relaxation, which eventually happened the following month.
On Friday, once again, Haddad said the last interest rates, with the BC under the command of Galipolo, were hired at the last meeting of the Copom presided by Campos Neto, when the interest rates went up 1 percentage point. At the meeting, held in December, the committee indicated the repetition of the dose – ie new increases of 1 percentage point of Selic – in the first two meetings this year.
