MNI BRIEF: BCB Data-Dependent To See How Long Rates Stay High

Central Bank of Brazil Governor Gabriel Galipolo said Thursday that the board will act in a data-dependent manner in assessing how long its interest rate needs to remain very restrictive to bring inflation to the 3% target.

"Regarding the question of what ‘sufficiently prolonged’ means, I think this connects with what we have been doing and communicating. This is a central bank that remains data-dependent,” he said at the press conference following the presentation of the quarterly monetary policy report.

The BCB held its interest rate at 15.00% last week and said monetary policy should be at this level for a "very prolonged period."

"We are trying to make as clear as possible what it is seeing and how it can best inform how it is likely to react depending on what happens. So, how prolonged and how contractionary the interest rate is today basically responds to that question." (See MNI BCB WATCH: Copom Reiterates Higher For Longer Strategy)