Fundo de pensão da Petrobras esquece leilão e perde R$ 50 mi
26 de fevereiro de 2010Vazamento de informação volta a preocupar o mercado
2 de março de 2010Yields on Brazil’s interest rate future contracts jumped after central bank President Henrique Meirelles said the monetary authority is ready to take unpopular steps if necessary to keep inflation in line with the government’s target.
The yield on the overnight interest-rate contract due January 2011, the most traded on Sao Paulo’s BM&F exchange, rose seven basis points to 10.48 percent at 2:51 p.m. New York time, the highest level since Dec. 23.
Meirelles said today it’s a mistake to believe the central bank will “change its behavior” or avoid unpopular decisions because of October presidential elections. He cautioned against reading into journalist interpretations after Valor Economico newspaper published an interview with him under a headline “Reserve Requirements Should Delay Increasing Interest Rates.”
The central banker’s decision to say the article was misleading sent a message to investors that “there is a real chance that the interest rate will go up in March,” said Eduardo Cotrim, head of the trading desk at Banco Modal SA.
“Ideally the central bank wants to coordinate market
expectations so that the interest rate decision does not cause a surprise,” he said in a telephone interview from Rio de Janeiro.
As economic growth quickens, inflationary pressures are increasing. Traders are betting policy makers will raise the benchmark interest rate by at least a quarter of a percentage point next month to slow expansion and put a lid on inflation, Bloomberg estimates based on rate futures show.
Newspaper Article
At today’s event, Meirelles told central bank officials that society should evaluate central bank documents and refrain from reading into news accounts.
“To act in a consistent fashion means not to avoid making decisions that are technically justifiable and that, in the short-term, may seem unsympathetic or unpopular,” Meirelles said in Brasilia.
Meirelles told the Sao Paulo-based newspaper in an interview published today that the Feb. 24 decision to raise reserve requirements by 71 billion reais ($39 billion) “without a doubt” will have an impact on monetary policy.
Policy makers on Jan. 27 left the benchmark interest rate unchanged at 8.75 percent while removing language from their statement that the record-low rate was consistent with a non- inflationary recovery.
The benchmark IPCA consumer price index accelerated for the fourth straight month in January, to 4.59 percent, as domestic demand picks up. A report yesterday showed a broader measure of inflation that includes wholesale prices quickened to the fastest in 19 months.
The central bank targets inflation of 4.5 percent plus or minus two percentage points.
