Durigan promises technical rigor in BC appointments and maintains gradual fiscal adjustment
Finance Minister says he has not yet spoken to Lula about new indications and points out deficiencies in André Lara Resende's idea to limit interest rates
BY THE X-TRADER NEWS NEWSROOM · REPORTING FROM MONEY TIMES · 3 MIN
The Minister of Finance, Durigan, stated on Tuesday (3/11) that the appointments of Central Bank directors must follow “technical rigor” and include “different profiles”. According to Money Times, he also said that he did not talk to Lula about new appointments to the municipality. The statement comes at a time when the market is closely monitoring the composition of the BC board and the conduct of interest rate policy.
According to InfoMoney, based on Reuters, Durigan stated that Lula has no agenda with other economists on the topic. Estadão noted that there is no agenda scheduled with the president to discuss the issue. In the same vein, Money Times reported that, in the conversations it had, there is nothing that justifies a “fearful position” in the market.
In the fiscal field, the minister defended a “gradual adjustment” that respects campaign commitments, justice for the poorest and progressiveness, according to Money Times. Estadão reported that the government continues with the gradual adjustment in public accounts, “as they have already been doing”, and that this is the line adopted today.
Regarding economist André Lara Resende's proposal to limit interest rates, Durigan said, according to Estadão, that the idea has “several deficiencies”. He stated that nothing like it is on the government's table and classified the discussion as “incipient”, placed for public debate. According to the same report, he, the team and other economists will talk about the proposal.
The set of statements shows a government that tries to separate the academic debate from ongoing decisions, maintaining the discourse of fiscal gradualism and technique in BC nominations. There are still no names, dates or decisions announced, and the minister himself addressed the idea of limiting interest rates as an early stage issue.
What changes for the investor
For those who operate interest, dollar and stock markets, the central point is signaling. By linking appointments to technical rigor, the minister seeks to indicate predictability regarding the Central Bank's management, something that usually weighs on interest and exchange rate expectations. As there are no scheduled conversations with Lula and Lara Resende's proposal remains under discussion, the matter remains undefined. The concrete effect will depend on the names chosen and how the fiscal adjustment progresses in practice.
Automatically translated from Portuguese.
