The president of the central bank, Gabriel Galípolo, stated this Monday (19) that keeping the interest rate at a higher level makes sense given the current scenario of the Brazilian economy.
According to him, at times like the present, the period of remaining at a restrictive rate has a greater weight than possible specific adjustments, directly influencing the inflation convergence process.
The statements were made during a lecture at 12th Annual Brazil Macro Conference, event promoted by the bank Goldman Sachs, in São Paulo (SP).
Last week, the Central Bank's Copom (Monetary Policy Committee) raised the Selic rate to 14,75% per year, reaching the highest level in almost two decades.
On Monday, Galípolo highlighted that, with inflation expectations still above the central target and with the challenging economic scenario, it is justifiable for the Central Bank to keep interest rates at more restrictive levels for a longer period than usual.
He also recalled that Brazil is now in its fourth consecutive year with GDP growth above 3%, which reinforces the need for caution in monetary policy.
As a rule, a significant increase in interest rates is detrimental to the economic activity and development of any country, even though it is a necessary measure to control inflation. From the investors' point of view, it serves as a parameter to assess the viability of their investments.
In the solar energy sector, the high interest rate environment tends to impact investments. The increase in the cost of capital and the rise in financing rates tend to reduce the appetite for long-term projects, such as those aimed at solar energy generation, especially in a scenario where investors seek safer investments with more immediate returns.
all the content of Canal Solar is protected by copyright law, and partial or total reproduction of this site in any medium is expressly prohibited. If you are interested in collaborating or reusing part of our material, please us by email: [email protected].
