The fiscal framework, although its parameters have not yet been calibrated, seemed "quite reasonable," says Campos Neto.
The Central Bank president says he has not yet seen the "details" of the new fiscal framework.
Reuters - The president of the Central Bank, Roberto Campos Neto, stated this Thursday that he has not yet looked at the "details" of the new fiscal framework, which is being released this morning at the Ministry of Finance.
According to Campos Neto, when the Central Bank became aware of the general rules of the new fiscal policy, even before the government set its parameters, the framework seemed "quite reasonable," but he stressed that this was some time ago.
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Campos Neto stated that what is important for the Monetary Policy Committee (Copom) is how the committee will incorporate the framework into its projections. Campos Neto affirmed that the framework is a factor in monetary policy decisions. "At this moment, we have nothing to declare about the framework; we need to analyze it," he added.
The government's proposal for the new fiscal framework will include a safeguard to prevent federal spending from growing faster than revenue, but will also have a minimum limit for the growth of expenses, according to a document released by the Ministry of Finance this Thursday, in a rule that will have flexible targets for the primary result.
As anticipated by Reuters, the measure establishes that public spending cannot grow by more than 70% of the variation in revenue.