Brazil: President Lula da Silva attacks the Central Bank’s autonomy again, and is already talking about changes

President Lula da Silva once again attacked the Central Bank’s (BC) autonomy and promised “changes” when the mandate of the current BC president, Roberto Campos Neto, ends.

He also criticized the current level of interest rates.

The speeches were made on Thursday 2, in an interview with Rede TV!

“I’m going to wait for this citizen Campos Neto to finish his mandate so we can make an evaluation of what the independent Central Bank has meant,” said Lula da Silva.

The term of the Central Bank president ends in December 2024. From then on, the government can appoint a new name for the position.

Lula da Silva’s nominee will be submitted to the Senate for approval.

“What happens is that we used to talk,” said Lula da Silva.

“Is this country doing well? Is this country growing? Are people’s lives improving? No. So, I want to know what the point of independence was.”

Lula wants the presidents of the House, Arthur Lira (PP-AL), and the Senate, Rodrigo Pacheco (PSD-AL), to say if “they are happy with Campos.”

“I think they imagined that, with the autonomy of the Central Bank, the economy would grow again, interest rates would go down, and everything would be wonderful,” he said.

CENTRAL BANK INDEPENDENCE

Approved by the Bolsonaro government, the measure reduces to a minimum the chances of political interference in the institution’s decisions, such as the government pressuring the Central Bank to lower the Selic rate – the most common -, increase it, or immediately change the president of the Central Bank, who will now have a four-year mandate.

Free of political interference, the monetary institution gains more credibility with national and foreign investors since there is a feeling of greater legal security in the financial system and, consequently, in the country’s economy.

With this, the country risk tends to fall.

The country risk indicates the level of economic stability and is used by investors when deciding in which nation to invest their money.

With information from Revista Oeste