With high interest rates and a focus on the market, the Central Bank is stifling Brazil's growth, says José Dirceu.
According to the former minister, Brazil is experiencing a paradox: it is growing despite the high Selic rate, which would prove the structural flaw in the current monetary policy.
247 - Former minister José Dirceu harshly criticized the Central Bank's (BC) conduct of monetary policy, even after the appointment of Gabriel Galípolo as president of the institution by the Lula government. In an article published in GGN newspaperDirceu emphasizes that the problem is not about individuals, but about the historical hegemony of financial capital – represented by “Faria Lima” – over Brazilian monetary policy, with growing support from agribusiness and the mainstream media.
In the text, Dirceu points out that Brazil remains stuck in an orthodox and outdated monetary model, unlike the world's major economies. While the United States, the European Union, Japan, and the BRICS adopt industrial, tariff, and fiscal policies to foster growth, innovation, and sovereignty, the Brazilian Central Bank maintains a high interest rate policy with an unrealistic inflation target of 3%, even in the face of a reality where global inflation is linked to supply crises and not demand.
According to Dirceu, Brazil is experiencing a paradox: it is growing despite the high Selic rate, which would prove the structural error of the current monetary policy. He criticizes Galípolo's behavior in announcing the maintenance of high interest rates as a "petulant" reaction to criticism. For Dirceu, the Central Bank acts beyond its original function, interfering in fiscal and economic policies with regressive impacts – as in the case of the IOF (Tax on Financial Operations) – penalizing the poorest and restricting the State's investment capacity.
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