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GENEVA AND LONDON – Already, foreign financial market badysts and some sectors of the national society had alerted, but a member of the government himself warned of an excess of optimism at the time. Brazil. The president of the Central Bank, Ilan Goldgfajn, who will step down in March estimated in the Swiss newspaper Le Temps that expectations in the country were very high. "The challenge is to be able to implement the announced measures and satisfy the voters," he told a Geneva-based publication, citing this climate as one of the risks for Brazil.
Tuesday, the Brazilian central banker will make a presentation at the University Institute of Geneva. The next day, he will also be a lecturer at Bocconi University in Milan for a European tour that will kick off this weekend with bi-weekly meetings of central bankers in Basel, Switzerland. "The most important thing is to put in place a reliable monetary policy, knowing that the fiscal environment remains fragile, and this success depends on the determination to go to retirement," he told the newspaper. The Time on the content of his speeches of the week to come.
In the interview, Goldfajn explains that he will leave the Central Bank for personal reasons after two years and seven months in front of the institution, and that he will work "in other sectors." He also reaffirmed his commitment to remain in office until the Senate confirms the appointment of his successor, Roberto Campos Neto, who was working in Brazil for the Spanish bank Santander.For him, the current president said that a lot of work had been done to clean up the economy, but that this should continue. ensure the continuity of monetary policy t structural reforms, "he said.
The President has estimated that inflation is under control and will continue in the coming years. The interest rate is also at a low level, which he says is also a good incentive for the business. Still on the economic front, Goldfajn recalled that the country went into recession in 2015 and predicted that 2019 would be the second year of recovery of gross domestic product (GDP). "The growth – 1.3% – was low in 2018. For this year, we expect a rate of 2.5%," he said. Then questioned on the need of President Jair Bolsonaro to request a "shock treatment" for the national economy, he baderted that the idea was to seek reforms and increase the flexibility of the economy. 39; economy. "If the new government puts the bills in order, the economy will become more productive," he said, adding that markets such as liberalization of the economy, privatization, spending cuts public and, above all, visibility and trust.
Goldfajn estimated that 2018 was a difficult year for the new countries. First, there was an excess of capital in rich countries, which caused an influx of capital to emerging countries, which fueled inflation. Then, the monetary tightening caused the opposite movement. "Several countries, such as Argentina or Turkey, experienced slower growth, and other countries like India, Brazil, and Indonesia had to protect themselves. reforms that maintain growth, "he said. During periods of economic stress, in particular exchange rates, the Brazilian Central Bank offered foreign exchange swap contracts to market agents to hedge against fluctuations in the real against the US dollar.
Regarding the "fears" raised by the government of Bolsonaro the president of the monetary authority baderted that the most important was to implement a reliable monetary policy, knowing that the # The fiscal environment remains fragile. "And this success depends on the determination to carry out all the reforms." At the evaluation of No. 1 British Columbia, the autonomy of the institution is badured and constitutes a condition of the stability of the monetary system. "The Ministry of Finance may have its own priorities that are not those of the Central Bank, but at this moment I see only positive signs for investors."
In this regard, the paper pointed out that 39 independence of some central banks of the world – especially in the United States, because of criticisms made by President Donald Trump to the work of the Federal Reserve . However, Goldfajn stressed that the monetary authorities were the last resort in the event of a financial and economic crisis and that they had the necessary tools to act. "Questioning your independence, is putting your credibility at stake. Markets must also know that central banks can act independently when a situation requires it," he said. declared.
In the interview, Goldfajn said "safe" that the measures taken by the Argentine government in collaboration with the International Monetary Fund (IMF) will produce results in 2019. In the case of another neighbor, he felt that it was incumbent on Venezuelans to find a solution. to the problem of the country. "As far as their economy is concerned, it is too weak to have a contagious effect in South America," he said.
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