BRASILIA (Reuters) - Brazil Treasury secretary Rogerio Ceron on Monday said the sooner monetary easing begins, the sooner conditions will be created for an "adequate" 2024, emphasizing that high interest rates have an impact on the public debt cost.
In an interview with local news channel BM&C News, Ceron said that nearly 90% of the market anticipates interest rate cuts to kick off in August or September, estimating that "this should start at some point."
He emphasized that one-third of the country's debt is directly linked to the central bank's benchmark Selic interest rate, resulting in an undeniable impact.
"It is obvious that in fiscal policy, we want the interest rate to be as low as possible as soon as possible," he said, noting that inflation is approaching the central bank's target range, which is crucial and may enable policymakers to eventually reduce borrowing costs.
The central bank's weekly survey with private economists on Monday showed a new round of reductions in inflation expectations, with a median forecast of 5.06% inflation this year, against an official 3.25% target with an upper band of 4.75%.
Last week, the central bank kept interest rates unchanged at a cycle-high of 13.75%.