Interest rate decisions of the main Western Central Banks guide “super week”; understand

Major Western central banks make rate decisions this week.

On Wednesday, it is the turn of the Brazilian and American BCs (Fed). In the US, the expectation is that the monetary authority will raise the basic rate by 0.25 percentage points – to the range between 4.5% per annum and 4.75% per annum. In Brazil, the rate should remain at 13.74% pa.

At the ECB (European Central Bank) and at the BoE (Central Bank of England), the increase should be 0.5 pp in both cases, 2.5% in the case of the ECB and 4% in the United Kingdom.

All these countries have the same problem: high inflation, and a single instrument: the interest rate. But each of them depends on a dosage, reflecting the different reality of the economies and the exposure to the fragility of the price shock.

In the case of the United Kingdom and other European countries, it is worth mentioning that the economies were extremely fragile to the shock of energy prices.

In Brazil, the first monetary policy meeting of the year, with an independent BC in a Lula government, attracts attention not only for the interest rate decision, but for the messages that the president of the autarchy, Roberto Campos Neto, will pass on to the PT administration .

In order not to lose its institutional character, the Central Bank must express concern about risky decisions on public spending and inappropriate debates, which hinder the fall of inflation and, therefore, interest rates.

Among the targets of the Monetary Policy Committee, there may be the return of public banks as growth drivers, not only in Brazil, but in neighboring countries in Latin America.

Questions about the credibility of the Central Bank or the inflation targeting system should also appear as a source of risk for the economy.

With information from Thais Heredia