March 26, 2023

Lula could promote a major change in the central bank soon

The Central Bank of Brazil is a federal institution that operates independently. It is an integral part of the national financial system and has nothing to do with any ministry. Founded in the early 1960s, the bank is one of the central institutions in the country when it comes to finance and economics, for example, being responsible for launching Pix.

A new vacancy is expected to open soon for a new member to join the monetary policy board of the Central Bank, and the nomination must be made by the President of the Republic, who is currently occupied by Luiz Inacio Lula da Silva (Workers’ Party).

Learn more about the change that could happen in the central bank / Photo: Marcello Casal Jr / AgĂȘncia Brasil

Big change in the central bank soon?

The vacancy is supposed to open in the last week of February, as the mandate of the current director of the Central Bank, Bruno Serra, ends on February 28, Tuesday.

According to the information disclosed, interlocutors in the National Congress and in the Palace of Planalto warned the incumbent president that the nomination of Khalifa Serra should not follow an anti-market economist, as the nomination may end up in the Federal Senate.

Thus, Serra will still be able to remain in office until his successor is determined and takes over the vacant position. He might even be a member of the upcoming Copom meeting, the group that decides Brazil’s benchmark interest rate. The meeting is scheduled to take place between March 21 and 22.

Until now, it is not known who will be the candidate for president. There is an expectation that the current Minister of Finance, Fernando Haddad, and the current head of the Central Bank, Roberto Campos Neto, will jointly name Serra Lula’s successor.

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What can you expect?

Based on information from CNN, Planalto expects Campos Neto and Haddad to nominate a succession to the position of chief economist who understands the importance of fiscal adjustment, so that a sustainable interest rate decline is possible. In addition, you are expected to be a person with good access to the financial market.

The president’s aides warn that picking the person who reduces the fiscal adjustment and who intends to cut the SELIC rate more aggressively could end up causing the nomination to remain blocked for a while in the committee in charge of Saturday, the Committee on Economic Affairs (CAE) of the Senate.

Although it is not believed that the nominated name will be rejected, one possibility is that an economist with an “anti-market” view could lead to a further delay to Shabbat, which could lead to wear and tear. Government.

In addition to the vacancy for Bruno Serra that will open, the vacancy for Director of Inspection may also open this week, as his assignment also expires on 02/28/2023.

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