MNI BRIEF: Brazil Not Even Close To Fiscal Dominance - David
MNI (BRASILIA) - The appointee for the Central Bank of Brazil's board, Nilton David, said Tuesday that the country is not even close to a fiscal dominance situation and that monetary policy "has indeed played a role" in controlling inflation.
"I am convinced that we are not close to fiscal dominance. I see nothing objective or clear indicating otherwise," he said during his hearing at the Federal Senate for approval to assume the position. "Based on assumptions, such activity should have generated even higher inflation than we have experienced. This proves that monetary policy has indeed played a role in maintaining stability or at least preventing an even greater spike in inflation," he added.
David will succeed Gabriel Galipolo as deputy governor for monetary policy. Galipolo, recently approved by the Senate, will assume the role of Central Bank governor starting Jan. 1.
"Inflation and inflation expectations remain above the target's center, requiring the central bank’s firm action to fulfill its mandated responsibilities, a process that is already underway," he emphasized. (See MNI INTERVIEW: Copom To Accelerate Rate Hike Pace To 100BP)