MNI BRIEF: BCB's Campos Neto: 'Not Afraid To Do What's Needed'
Central Bank of Brazil Governor Roberto Campos Neto says its forward guidance on cuts is data dependent.
Central Bank of Brazil Governor Roberto Campos Neto said Wednesday the board is "not afraid to do what's needed" if economic trends change, adding that its forward guidance for a 50 basis-point cut at the May meeting is data dependent.
"Every time we have a guidance and need to change, it's an issue of credibility. But every guidance, because you don't know the future for certain, comes with a disclaimer," he said in a meeting with XP investors in Washington. (See MNI INTERVIEW: Lower Inflation Could Hasten Copom Cuts-Werlang)
The BCB said in its last policy statement it anticipated another cut of the same magnitude "if the scenario evolves as expected." Investors speculate the central bank may need to slow cuts amid rising geopolitical tensions and domestic fiscal problems.
"We are not afraid to do what's needed. And I think we have tried to show that to the market. And if needed, we will show again and again," Campos Neto said.