Copom decides interest rates today (11), in the final meeting with Campos Neto at the helm of the BC

Copom decides interest rates today (11), in the final meeting with Campos Neto at the helm of the BC

The Monetary Policy Committee (Copom) will hold its last meeting of 2024 this Wednesday (11th). The level at which the Selic, the country’s basic interest rate, should close this month should be announced at 6.30pm. year. Currently the value is 11.25% per year.




Copom: Campos Neto’s last meeting as president of the BC

This meeting on Wednesday will also be the last Roberto Campos Neto in the presidency of the Municipality. From January the command will pass to Gabriel Galípolo, current director of Monetary Policy and first president of the Central Bank (CB) appointed by the third government Luiz Inácio Lula da Silva (PT).

Three new directors appointed by the PT government, approved by the Senate this Tuesday (10), will also join Copom.

The Focus bulletin published on Monday (9) highlights that the market, on average, sees the directors of the Central Bank (CB) pressing the accelerator, raising interest rates by 0.75 percentage points, bringing them to 12% per year.

If this percentage increase materializes, it will be the third time in a row that the board has accelerated the pace of tightening interest rates.

Why are interest rate increases expected to accelerate?

The financial market is attentive to possible accelerations in rate increases by Copom. Mainly due to factors such as fiscal instability, changes in exchange rates and deteriorating inflation expectations.

The acceleration of the Selic growth rate is an attempt to anchor inflation expectations, reiterating the Central Bank’s commitment to price stability.

In an interview with CNN, Sergio GoldensteinWarren Rena’s chief strategist said the acceleration is virtually certain as the 0.5% pace will be maintained “it would be very poorly received by the market”putting further pressure on the exchange rate, inflation expectations, the interest rate curve and implied inflation.

“In summary, [a decisão por manter o ritmo de 0,5%] would be seen as a sign of leniency and undermine the new BC council’s efforts to gain credibility.”Goldenstein added.

Source: Terra

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