Senate calls Campos Neto to explain interest rates – 03/14/2023 – Market

The Senate Economic Affairs Committee approved this Tuesday (14) an invitation for the president of the Central Bank, Roberto Campos Neto, to give explanations about the basic interest rate. The hearing is scheduled for April 4.

The invitation comes in reaction to direct criticism by President Luiz Inácio Lula da Silva (PT) and members of the federal government of the basic interest rate (Selic), which is at 13.75% per year, in the face of a scenario of economic slowdown , increase in defaults and signs of greater financial difficulties faced by companies.

“Due to this debate on Selic issues, President Roberto Campos Neto has always been helpful, every time we called him, invited him to come here at CAE and at other committees, he came to clear our doubts. He has already made himself available”, said the president of the commission, senator Vanderlan Cardoso (PSD-GO).

This Monday (13), the Minister of Economy, Fernando Haddad (PT), stated that Brazil has a “fat” -unlike the rest of the world-, which enables the Central Bank to cut interest rates.

The request for Campos Neto to go to the Senate was presented by Vanderlan Cardoso and had already been agreed with the president of the Central Bank since last month.

The parliamentarian met with Campos Neto at a dinner — even before assuming the presidency of the Senate commission — two days after the PT approved an orientation for the president of the BC to be called by the parties of the acronym.

Despite the invitation made by the Senate, the president of the House, Rodrigo Pacheco (PSD-MG), has stated that there is no willingness in Congress to revert the autonomy of the Central Bank or remove Campos Neto from office.

In the application approved this Tuesday, Vanderlan Cardoso says that the current Selic level “has generated a lot of debate in the economic area about the Central Bank’s obligation to reduce this index”.

“When the Selic rate increases, access to money by the population, both through lines of credit, loans and financing, is reduced. Thus, the consumer stops making greater expenses to save in the period of high inflation”, he writes.

“On the contrary, when the Selic rate is low, the stimulus to consumption is greater and the economy tends to become more heated. That is, people consume more”, concludes the senator in the application.

As of this Wednesday (15th), the so-called silence period of the Copom (Monetary Policy Committee) begins, in which the president of the Central Bank must “avoid as much as possible” commenting on subjects that cover the Brazilian economy and the international scenario, such as interest rates interest rates, foreign exchange or any other issues that may influence the decision of the collegiate.

This month, the deadline ends on the 28th —the Tuesday after the meeting that recalibrates the Selic level—, when the minutes of the meeting are also published. The next Copom meeting is scheduled for March 21st and 22nd

In an interview with the program Roda Viva, on TV Cultura, on February 13, the head of the municipality said that he is open to going to Congress and that it is his “obligation” to provide this type of clarification.

“The BC needs to work together with the government. I’m going to do everything in my power to bring the BC closer to the government”, said Campos Neto at the time.

The commission also approved an invitation to the current and former directors of Lojas Americanas, and to the presidents of Febraban (Brazilian Federation of Banks), Isaac Sidney, and of the CVM (Securities and Exchange Commission), João Pedro Nascimento. The hearing is scheduled for March 28.

One of the guests is the executive Sergio Rial, who opened the hole in the company’s accounts after staying for just nine days in the presidency. The retailer declared to the Court that the total amount of its debt is around BRL 43 billion and entered into judicial recovery

Different Senate committees are also expected to approve invitations to 12 of Lula’s ministers this Tuesday. Everyone’s goal, however, is to hear the priorities of the ministries for the year and draw up strategies with the Legislative.