Senate avoids initiatives against the Central Bank – 03/26/2023 – Power

Even with pressure from President Luiz Inácio Lula da Silva (PT) on the president of the Central Bank, Roberto Campos Neto, senators rule out an offensive against the institution and demand that the government send the new fiscal framework to reduce interest rates.

Faced with Lula’s criticism, the Senate approved an invitation for Campos Neto to explain why the basic interest rate (Selic) is at 13.75% per year —the highest level since 2017. ) is scheduled for April 4.

The request for Campos Neto to go to the Senate was presented by the president of CAE, senator Vanderlan Cardoso (PSD-GO), and had already been agreed with the president of the Central Bank since last month.

There won’t be that pressure [contra Campos Neto]. Even because it has already been proven that it does not work. So political pressure and catchphrases did not work”, says the president of CAE about the public hearing.

The senator claims that the idea was also to hear Campos Neto’s impressions on the new fiscal rule, which will replace the spending ceiling. The idea is for the proposal to be released after Lula returns from an official visit to China.

With the cancellation of the official trip due to the PT’s health issues, there is a possibility that the milestone will be presented in the next few days.

The leader of the MDB, Senator Eduardo Braga (AM), who is part of the group, says that the president of the BC will be able to clarify what has based the decision on the Selic, but assesses that only the submission of the new fiscal framework can influence the fall of interest.

“I think there will be a debate on the issue of interest rates, but it will not go beyond that: a debate. It’s not like this: ‘Senator so and so dawned in a bad mood and is going to impeach the president of the Central Bank'”, he says.

On Thursday (23), the day after the Copom (Monetary Policy Committee) decision that maintained the Selic rate at 13.75% per year, Lula said that the president of the Central Bank does not comply with the law and that the Senate needs to take care of him. The petista also returned to referring to Campos Neto as “this citizen”.

“The Senate has to take care of Campos Neto, which appointed him. He was not elected by the people, nor by the president. He was appointed by the Senate. If that citizen wants to, he doesn’t even need to talk to me. He just has to comply. the law that established the autonomy of the Central Bank.”

Despite this, not even senators close to Lula, such as the majority leader, Renan Calheiros (MDB-AL), have entered the artillery against Campos Neto. Calheiros says that the Selic level is “immoral”, but that parliament cannot just put pressure against it.

“All of us who voted for the independence of the Central Bank want to see it complete. The president [Campos Neto] has had a good relationship with parliament so far”, says Calheiros.

“You can’t just apply pressure to lower interest rates. It is evident that these interest rates are immoral, but you have to understand the reasons. Parliament’s role is to hold this debate, this discussion. And not merely put pressure.”

The leader of Podemos in the Senate, Oriovisto Guimarães (PR), who is also a member of the CAE, says that the possibility of taking Campos Neto out of office “is zero”. The senator claims that the “great responsibility” for the interest “is the Executive, which does not propose a legal framework”.

“Possibility of reviewing the autonomy of the Central Bank: zero. Possibility of interfering in the mandate of the president of the Central Bank, Roberto Campos Neto: zero. There is no environment for that in the Senate”, he says.

“The autonomy of the Central Bank is an old struggle in Brazilian politics. It is a civilizing level. And, if you are not going to mess with the autonomy of the BC, much less with the president. Nobody would consider proposing something like that”, he completes.

The president of the Senate, Rodrigo Pacheco (PSD-MG), has stated that the autonomy of the Central Bank is an issue overcome in Congress, and that he defends dialogue between Campos Neto and members of the federal government.

The senator proposed an audience in the plenary of the Senate to hear, among other authorities, the president of the Central Bank and the ministers of Finance, Fernando Haddad (PT), and of Planning, Simone Tebet (MDB), about inflation, interest rates, and ” resumption of growth”.

The president of the Chamber of Deputies, Arthur Lira (PP-AL), has also told people close to him that the chance of any movement against the BC or Campos Neto going ahead in Congress is minimal, but he assesses that the institution lacks sensitivity in relation to the fees.