MNI BRIEF: Brazil Requires Prudent Monetary Policy - Galipolo
MNI (BRASILIA) - Central Bank of Brazil Deputy Governor for Monetary Policy Gabriel Galipolo said on Tuesday that an unanchoring of inflation expectations demands greater prudence in monetary policy.
"Unanchored expectations bother us, along with a tighter labor market and conditions that seem more adverse due to an exchange rate that appears to remain at a more depreciated level compared to some time ago,” he said at a hearing in the National Congress to approve his appointment to replace Roberto Campos Neto as governor early next year.
“Growth has been surprising and exceeding original projections, which recommends greater prudence from a monetary policy perspective.”
Campos Neto's mandate expires on Dec 31, and if approved by the senators, Galipolo will take office on Jan 1.
"There is significant discussion about the future, with various economists pointing out that we may transition from a positive fiscal impulse to a significant reduction in that impulse," he added. (See MNI INTERVIEW: More Brazil Budget Freezes If Needed -Guimaraes)