To Ensure Inflation Convergence and Maintain Selic Rate at Austerity Level, Central Bank Signals Economy with Tight Monetary Policy for Longer in Open Letter

Written by Bruno Teles

Published on 12/01/2023 at 19:11

Para garantir a convergência da inflação, e manter taxa Selic em patamar de austeridade, em carta aberta, autoridade monetária (BC) sinaliza economia com taxas em aperto monetário por mais tempo (Foto/divulgação)

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Understanding What The Central Bank (BC) Wants For The Selic Rate In The Coming Quarters, Keeping The Basic Rate Of The Economy At Restricted Levels, Is The Expectation Of Finance Minister Fernando Haddad, Since The Goal Is To Zero The Deficit By The Beginning Of 2024.

In divergence, the market, which spends each day hoping that the BC will start cutting the Selic rate, which is at its highest level since 2016, 13.75%. However, last Tuesday (10), the monetary authority sent a message to Haddad. In an Open Letter, the Selic rate will remain high for a longer period. And the market wanted some reduction to happen as early as the first quarter.

The BC explained that the maintenance of rates, in monetary tightening, allowed inflation to end 2022 above the upper limit of the target, at 5.75%. Market specialists still project that the Monetary Policy Committee (Copom) may adjust interest rates, despite the message. However, the agency’s message is clear, “according to the Communication and the Minutes of its most recent meeting, the Committee will remain vigilant, assessing whether the strategy of maintaining the basic interest rate for a sufficiently prolonged period will be able to ensure the convergence of inflation.

The Bank discusses other reasons, in full, “i. Inertia of inflation from the previous year; ii. rise in commodities prices, especially oil; iii. imbalances between supply and demand for inputs and bottlenecks in global production chains; iv. shocks in food prices, resulting from climatic issues; and v. resumption of demand for services and employment, driven by the sharp decline in the number of Covid-19 cases and the consequent increase in mobility.

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Tough Tone And Distant Horizon

In a speech where the impacts of fiscal risk are not present, investors, even with other demands, know that maintaining the Selic rate at 13.75% for a longer time is the way to ensure convergence. And if there is someone awaiting a review of interest rates, what is envisioned is a residual rise.

Only after September 2023 is there a residual probability of the Selic rate decreasing, that is, in December, it will end the year around 12.25%. It is a stability that projects over a long period.

To Ensure Inflation Convergence and Maintain Selic Rate at Austerity Level, Central Bank Signals Economy with Tight Monetary Policy for Longer in Open Letter

Understanding What The Central Bank (BC) Wants For The Selic Rate In The Coming Quarters, Keeping The Basic Rate Of The Economy At Restricted Levels, Is The Expectation Of Finance Minister Fernando Haddad, Since The Goal Is To Zero The Deficit By The Beginning Of 2024.

Tough Tone And Distant Horizon

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To Ensure Inflation Convergence and Maintain Selic Rate at Austerity Level, Central Bank Signals Economy with Tight Monetary Policy for Longer in Open Letter

Understanding What The Central Bank (BC) Wants For The Selic Rate In The Coming Quarters, Keeping The Basic Rate Of The Economy At Restricted Levels, Is The Expectation Of Finance Minister Fernando Haddad, Since The Goal Is To Zero The Deficit By The Beginning Of 2024.

Tough Tone And Distant Horizon

Libya built over 4,000 kilometers of underground pipelines to bring water from the Sahara to coastal cities in a project that the government itself called the Eighth Wonder of the World.

Desert sand, previously discarded for being too smooth for concrete, becomes an ecological brick in the United Arab Emirates, dispensing with Portland cement, curing at room temperature, and attempting to transform dunes useless for construction into raw material for a new arid engineering.

He transformed an abandoned plastic water tank into an underground house in the “hobbit hole” style, using only repurposed pallet wood, without heavy machinery or expensive labor.

China transforms desert-devastated area into the world’s largest artificial forest, planting trees for 60 years, blocking sand that reached Beijing, and creating a “green lung” of 92,000 hectares in a region once considered lost.

Toyota launches “family hybrid van” with 7 or 8 seats, 1.8 hybrid engine, fuel consumption of up to 23.8 km/l, and a price equivalent to about R$ 104,000 without taxes, below the Tiggo 8 Pro Plug-in Hybrid sold in Brazil: meet the Noah Hybrid 2026 in Japan.

Described by astronauts as one of the most unlikely natural phenomena on Earth, the Okavango Delta spreads over up to 15,000 square kilometers in the middle of the desert and transforms Botswana into a living labyrinth of channels, islands, and flooded areas.

Chinese woman planted trees for decades while sand buried part of her house, received $5,000 from an American in 1999, and helped transform the desert into a forest of 8 million trees in China.

Change in INSS reduces waiting time from 45 to 30 days, prioritizes pensions, revisions, and BPC, and could expedite over 100,000 stalled processes, while employees receive productivity bonuses and the government attempts to reduce a backlog that still exceeds 2.1 million requests.

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Change in INSS reduces waiting time from 45 to 30 days, prioritizes pensions, revisions, and BPC, and could expedite over 100,000 stalled processes, while employees receive productivity bonuses and the government attempts to reduce a backlog that still exceeds 2.1 million requests.

David Camacho, the 10-year-old Mexican child prodigy with an IQ of 162, higher than Einstein’s, underwent astronaut training at NASA, speaks four languages, and created an app to help children deal with emotions after the bullying he experienced.

London waited more than 360 years for this scene: four pelican chicks are born in St James’s Park, surprising experts, resembling little dinosaurs, and turning an isolation caused by avian flu into a historic chapter for the birds that have lived alongside British royalty since 1664.

They wanted artificial intelligence, but they drained the water from a village in Mexico: the water consumption of data centers caused a hepatitis outbreak, and big tech companies Amazon, Microsoft, and Google were forced to halt billion-dollar projects.