Lula demands that the Central Bank guarantee jobs, growth, and inflation control.

(Reuters)- President Luiz Inácio Lula da Silva stated that he does not intend to interfere in the mandate of the Central Bank president, Roberto Campos Neto, but urged the monetary authority to control inflation and stimulate growth and job creation, tasks that he said are stipulated in the law guaranteeing the entity's autonomy.

In an interview with CNN Brazil, Lula argued that raising interest rates is not the appropriate tool for the current economic context, considering that in Brazil's case, inflation is not generated by demand pressures.

"He's there, he has a mandate," the president told CNN Brazil, when questioned about a possible attempt to remove Campos Neto, but without failing to mention that, having been appointed by the previous government, the president of the Central Bank has a different "mindset" than his and that of his voters.

>>> Lula states that the Central Bank is autonomous, not independent, and demands social responsibility.

"The only thing I want is for him to comply with what is in the law that approved the independence of the Central Bank. He has to take care of inflation, he has to take care of growth, he has to take care of employment," the president added.

The legislation, approved in 2021, establishes that the "fundamental objective" of the Central Bank is to ensure price stability, and that, without prejudice to this goal, the institution must also "smooth out fluctuations in the level of activity" and promote full employment, in addition to safeguarding the stability of the financial system.

According to Lula, there is no reason to fear a spike in inflation if interest rates are reduced. "Raising interest rates is important when you have demand-pull inflation," he argued. "That's not the case in Brazil."

Regarding the Central Bank's autonomy, he reiterated that the issue is not a central concern for him. According to the president, there is no problem in maintaining the institution's autonomy if it proves to be beneficial.

>>> "When you deny politics, you end up with Hitler, Mussolini, and Bolsonaro," says Lula.

In the approximately one-hour interview, Lula did not hold back in his criticism of the market and called for greater sensitivity from investors. However, he denied that there is a "policy of confrontation" with the market, attributing the generation of noise to those who have an interest in speculation.

Along the same lines, he said he had no interest in fighting with Campos Neto, but again referred to him as "citizen".

"As President of the Republic, I am not interested in fighting with a citizen who is the president of the Central Bank, whom I barely know; I've only seen him once," he stated in an interview with CNN Brazil, according to a segment broadcast this afternoon.

"He needs to know that in this country we have to govern for the people who need it most," Lula added, after stating that he would like Campos Neto to accompany him when his government visits the "most miserable" places in the country.

Lula has recently begun to strongly criticize monetary policy and has brought the Selic rate, currently at 13,75% per year, to the center of the debate. The president, as well as his ministers and even his party, the PT, question the reasonableness of this level compared to other countries.

Earlier this month, Lula said he considered the justifications given by the Central Bank's Monetary Policy Committee (Copom) for maintaining the benchmark interest rate at 13,75% "a disgrace," and referred to the head of the monetary authority as "that citizen."

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