Galípolo’s Appointment to Central Bank Changes Economic Game Plan of Lula’s Party
Lindbergh Farias, the incoming PT leader in the Chamber of Deputies, has changed his tune on Brazil’s Central Bank. He now supports Gabriel Galípolo, the future Central Bank president.
This shift includes tolerating higher interest rates for a while. Farias believes Galípolo’s appointment by President Lula changes everything. He expects Galípolo to focus on stabilizing the exchange rate first.
The deputy thinks Galípolo will then address slowing the economy with high interest rates. Throughout 2023 and 2024, Farias criticized the economic team and the Central Bank.
He called the recent one percentage point increase in the Selic rate “scandalous.” Now, Farias adopts a different tone. He cites Galípolo‘s statements about not prolonging the fiscal tightening cycle.
The deputy emphasizes the importance of the exchange rate. He notes its impact on food prices, inflation, and popularity. Farias points out that memes about rising beef prices have gone viral on social media.
These posts mock Lula’s campaign promise of affordable steak and beer. Farias expresses optimism about Galípolo’s future management of the Central Bank.
He believes Galípolo will align with the government’s policies. The deputy states that they now have influence over exchange rate, monetary, and fiscal policies.
Fiscal Package Defense and Political Strategy
The PT leader defends the recently approved fiscal package. He argues it represents a significant fiscal effort, contrary to market opinions. Farias highlights that changes to the minimum wage policy account for half of the package.
Looking ahead, Farias sees 2025 as a crucial year for consolidating Lula’s re-election bid. He notes the advantage of starting the year with the opposition on the defensive.
The deputy identifies the economy as the main challenge. Farias suggests a potential ministerial reform could strengthen the political core for upcoming elections.
He maintains that Lula remains the primary option for 2026. However, he mentions Education Minister Camilo Santana and Finance Minister Fernando Haddad as potential candidates for 2030.
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