Brazil’s Inflation Spike Is ‘Temporary’, Says Central Bank President Campos Neto

Last week, the central bank kept interest rates at a record low 2 percent and said inflation expectations and baseline projections remain significantly below target and well-anchored.

RIO DE JANEIRO, BRAZIL - Brazil’s recent spike in inflation is temporary, central bank President Roberto Campos Neto said, adding, however, that policymakers are monitoring developments closely.

In an interview with online personal finance channel Me Poupe, Campos Neto said financial markets are flashing red and that rising long-term interest rates and a steepening yield curve show investors are worried about growing fiscal risks.

He also said the central bank autonomy bill being debated in congress will separate the monetary policy and political cycles. All else being equal, greater credibility in the central bank will help reduce long-term . . .

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