Lula’s allies ask for an economist without heterodox ideas in BC

Leaders of the allied base in the National Congress defend the appointment of an economist without heterodox ideas to the Central Bank’s monetary policy directorate and the anticipation of the proposal for a new fiscal framework as a strategy to reverse the malaise between the government and the financial market.

These leaders are warning the Planalto Palace that a name seen as anti-market will only sour the climate with investors and will have difficulties in processing in the Senate.

The Economic Affairs Commission (CAE), responsible for the sabbath and first analysis of nominations to the BC, will be chaired by Senator Vanderlan Cardoso (PSD-GO) – who is avowedly Bolsonarist.

Cardoso will define, in this condition, the rhythm of the analysis. Given the history of nominations to the BC, a rejection of the name chosen by the government is considered highly unlikely.

However, if the name displeases the market, the senator’s interlocutors estimate that he could halt the process and postpone the date of his hearing – imposing a wear and tear on President Luiz Inácio Lula da Silva for weeks.

The current BC monetary policy director, Bruno Serra, is close to ending his mandate and the government will appoint a replacement at the end of February. The escalation of criticism made by Lula makes PT members consider a more heterodox name, little aligned with the market, for the position. That’s what leaders of governing coalition parties have suggested to Planalto not to do.

This Wednesday (8), the CNN showed that PT members defend that the nominee has a profile similar to that of economist André Lara Resende — or even himself.

Lara Resende was one of the formulators of the Real Plan and later held strategic positions in the Fernando Henrique Cardoso government, as special advisor and president of the BNDES. In recent years, however, he has taken a turn in economic thinking and moved closer to the left.

Another recommendation is to anticipate discussions on the new fiscal framework. The government has signaled that it will first submit its tax reform proposal to Congress.

For an ally of Lula in the Senate, the order should be reversed. The rule that will replace the spending ceiling is able to guide market expectations and show more clearly to the parliamentarians themselves how far a reform of the tax system can advance, says this senator.

According to sources in the economic team, the Ministry of Finance is rushing to complete an internal proposal for a new fiscal anchor by the end of February. From the turn of the month, this proposal would begin to circulate within the government to receive contributions from other ministries, such as Planning.