The minister stated, however, that the country must bring down inflation before other nations
Minister Paulo Guedes (Economy) said this Monday (11.Apr.2022) that interest rates are “relatively high” in Brazil. He said, however, that the country will beat inflation before other nations.
“Interest rates are even relatively high in real terms. But world inflation is there and we are going to fight it”said Guedes, lecture during the anniversary of the Commercial and Business Association of Maringá.
he said the BC (Central Bank) of Brazil moved before other central banks in fighting inflation and “already put the interest in place”. He said, then, that he is convinced that Brazil will bring down inflation “better even than several advanced nations”.
Citing the rise in prices in the United States, Guedes said that inflation is a global problem caused by the covid-19 pandemic and aggravated by the war in Europe. “Russia’s invasion of Ukraine has pushed up fuel prices, fertilizer prices, and that’s all pushing cost inflation through the world economy.”he said.
He said, however, that central banks in other countries “slept at the wheel” and were slow to act against inflation. Therefore, he said that “Brazil will have one of the most effective and fastest combats”.
The Central Bank has been raising interest rates since March 2021 to contain the rise in prices. The basic interest rate, the Selic, is at 11.75% and should rise further at the next Copom (Monetary Policy Committee) meeting, in May.
The president of the Central Bank, Roberto Campos Neto, hoped to end the cycle of high interest rates in May, placing the Selic at 12.75%. But he indicated this Monday (Apr 11) that he may review the trend because of high prices.
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