By Vinicius Sales
The President of the Central Bank (BC) says the government is competing with business “for the money they have available to invest in projects”.
The president of the Central Bank, Roberto Campos Neto, said that the high level of interest rates is not the Central Bank’s fault but the government’s debt.
According to him, it is a “fallacy” to claim that inflation is not related to demand.
“We have to be careful not to have an inversion of values. If you, a business person, are trying to get some money and it’s expensive, it’s not the Central Bank’s fault, because it’s wicked, it’s the fault of the government, which owes a lot,” he said in an interview to CNN Brasil on Friday (12).
According to Campos Neto, if the government debt were low, “the cost of money would be cheaper for everyone.”
“When we think that the government makes an issue today, a long issue, and pays a real interest rate above 6%, this has nothing to do with the Central Bank, this is a long-term perception, and there is a risk that justifies the real interest rate being 6%,” explained the president of the monetary authority.
Asked about President Lula, the BC president said he has talked to the head of the Executive Branch and is “available to talk to him, any day, any time, always.”
Since he assumed the presidency, Lula has been criticizing the BC and Campos Neto. According to the president of the Central Bank, “there is nothing” that the organ doesn’t want to discuss.
On the contrary, I try to schedule meetings with as many government ministers as possible,” he said.
The Central Bank chief also said two “fallacies” exist in discussions about inflation and interest rates.
“First, that inflation is not demand inflation,” he said. “The supply components existed at some point, especially during the invasion of Ukraine, but they have diminished,” he continued.
“Today, we have clear demand components, and we can quantify, depending on the index or what is happening in the economy, how much demand there is and where it is coming from. This is the first fallacy,” he explained.
The second fallacy is “that there is also something that says, ‘if it is supply inflation, you don’t have to do anything,'” Campos Neto said.
“Because the central bank has to fight demand inflation and fight what we call the secondary effects of a possible supply shock.”
REAPPOINTMENT
The BC president said he does not wish or expect to be reappointed to the post.
“It has nothing to do with the current government or past government. I said from the day I entered that I didn’t want to be reappointed,” he declared, adding that one mandate “is enough to do a lot.”
According to him, his mandate will be carried through to the end.
“I intend to stay until the end of the term; I think it is important to accomplish the mission.”
“We always want to do a mandate in the best way possible, to make the transition as smooth as possible when the transition has to be made,” he declared.
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