Brazil’s Finance Minister says the country is ready to start a cycle of interest rate cuts

The Minister of Finance, Fernando Haddad, defended again this Friday (19) the reduction of the introductory interest rate, Selic.

The minister said the country is ready to start a cycle of interest rate cuts.

“We think there is room to start a cycle [of rate cuts], but ultimately there is a technical team there [at the central bank’s monetary policy committee] that has been formed and that we are trying to respect,” he said.

He participated in an event promoted by the Central Bank.

According to Haddad, the Treasury has already presented data to the Central Bank showing that the country’s economy would support the reduction of interest rates, Agência Brasil reported.

“By the behavior of future interest rates, of the exchange rate, and of inflation itself, and this at a moment in which the economy shows that it is not slowing down, as was thought at the beginning of the year, it is slowing down because the rates are very high,” he said.

However, Haddad stressed that the debate about the interest rate policy could not be an “affront” to the Central Bank.

The minister said the ministry and the Central Bank should work harmoniously.

“We must understand that discussing monetary policy is not an affront to the monetary authority. On the contrary, everyone in this room and watching us knows that we are competing for the same objective”, he said.

According to Haddad, the Ministry, and the Central Bank should behave as two arms of the same organism.

“Remembering that there is not one hand that is more important than the other, and there is not one that is reactive to the other, both hands have to work actively for the benefit of an adequate regulation,” he pointed out.

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