Central Bank President expects wider economic opening in 2nd half-year

The president of Brazil’s Central Bank, Roberto Campos Neto, said he expects wider economic opening in the second half of this year, as well as a further recovery in services, significantly impacted by the COVID-19 pandemic.

The progress in the vaccination campaign in Brazil has contributed “significantly” to this scenario, he said, in addition to a greater resilience of economies, which have somehow adapted and suffered a smaller impact as a result of the restrictive measures stemming from the different waves of contamination.

“The economy somehow adapted to this new way of doing things, and I think [these changes] are mostly permanent,” said Campos, who also talked about the bank’s plans for the modernization of the economy and of payments.

As vaccination continues, Neto went on to say, the same kind of “euphoria” in services that has been observed in countries with more advanced vaccination may also be seen in Brazil. As an example, he mentioned the US, where it has become difficult to book a hotel room or a car.

The statements were made in English during a video presentation Tuesday (Jun. 8) directed at economists from bank JP Morgan. Campos Neto unveiled data monitored by the Central Bank on the pandemic and the economies’ response in both developed and developing countries.

Campos Neto acknowledged the pressure exerted by inflation worldwide and that supply prices are on the rise, in line with the hike in commodities, but he added that the curve in graphics is moving towards becoming steady.

In Brazil, estimated inflation rates are still pressed by the increase in energy prices brought about by the water crisis, the Central Bank head remarked.

This was the last statement of Campos Neto before the upcoming meeting of the Monetary Policy Committee (COPOM), slated for June 15, 16. In the previous meeting, the collegiate indicated a new rise in the benchmark interest rate, or Selic—currently 3.5 percent a year.