Brazil to formally enshrine central bank’s autonomy
Brazil’s government is formulating a constitutional amendment that would for the first time formally enshrine the autonomy of the central bank, the institution’s new head,Ilan Goldfajn said.
The new law would give the central bank licence to use whatever instruments it considered necessary to meet its objectives, which include financial stability and meeting an inflation target set in consultation with the government.
“There is a [bill] that will say explicitly that the central bank is autonomous: we call it operational autonomy,” Mr Goldfajn said in an interview.
The new law, which could go to Congress as a constitutional amendment as early as this year, would aim to shore up the central bank’s credibility in markets by reducing perceptions that it is vulnerable to political interference.
Under President Dilma Rousseff, who has been suspended from power pending an impeachment process for allegedly manipulating the government budget, there were persistent rumours of intervention in monetary policy to meet political goals.
During her government, interest rates were pushed down to record lows even as Brazil’s arch-enemy, inflation, was resurgent, undermining confidence in economic policy and culminating in a deep recession.
Mr Goldfajn, who was previously chief economist of Itaú Unibanco, Brazil’s biggest private bank, in June took over from Alexandre Tombini, a career technocrat who ran the central bank under Ms Rousseff.
check him out above..mission accomplished for the clan of berg..
“The new law would give the central bank licence to use whatever instruments it considered necessary to meet its objectives, which include financial stability and meeting an inflation target set in consultation with the government.”
you can do whatever you want whenever you want..