The Copom (Central Bank Monetary Policy Committee) stressed this Tuesday (13) that it remains vigilant about the high degree of uncertainty in the Brazilian fiscal scenario, and said that it will not “hesitate to resume the adjustment cycle, if the process of disinflation does not go as expected”.
“The Committee will remain vigilant, evaluating whether the strategy of maintaining the basic interest rate for a sufficiently prolonged period will be able to ensure the convergence of inflation”, he said in the minutes of the meeting last Wednesday (7), when it decided to maintain the Selic at 13.75% per annum.
And he emphasizes that “future steps of monetary policy may be adjusted and he will not hesitate to resume the adjustment cycle if the disinflation process does not go as expected”.
In the document, the Committee also cited the different channels through which fiscal policy can affect prices, “not only the direct effects on aggregate demand, but also via asset prices, degree of uncertainty in the economy, inflation expectations and interest rates. neutral”.
In addition, it points out that “changes in quasi-fiscal policies or the reversal of structural reforms that lead to a less efficient allocation of resources can reduce the power of monetary policy”.
*In update
Source: CNN Brasil
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