Lula could appoint six Central Bank directors by the end of 2027
Market fears a change in the profile of the Copom board and a return of the debate on loosening the inflation target, according to Folha.
Translated from the Portuguese original by the Panorama newsroom. Read in Portuguese
Summary written by the Panorama newsroom from the sources listed below. Facts are attributed to the original publications.
Reelected President Luiz Inácio Lula da Silva could choose six more names for the Central Bank board by the end of 2027, Folha de S.Paulo reported. Two seats have been vacant since January, two others could be filled by February, and two more open on December 31, 2027.
The prospect of a change in the profile of the Central Bank, and therefore of the Monetary Policy Committee (Copom), came onto the market's radar after the victory of the Workers' Party (PT) candidate. The main concern is that the institution will become lenient on inflation in order to speed up the decline of the Selic.
According to the newspaper, analysts already expect the debate on loosening the inflation target, currently 3% with a margin of 1.5 point above or below, to return.
Starting in 2028, the last year of the term of Central Bank president Gabriel Galípolo, the six new appointees would form a majority on the nine-seat board. Only Galípolo and directors Gilneu Vivan and Izabela Correa would remain, with terms through December 31, 2028.
Folha notes that Galípolo has been the target of criticism from members of the PT and the government, who blame him for the rise in public debt because of high interest rates. Minister Dario Durigan complained about the news coverage of the topic on Tuesday.