MNI BRIEF: BCB's Next Move Requires Greater Conviction- David

Central Bank of Brazil Deputy Governor for Monetary Policy Nilton David said Thursday the board's next policy move will need a more convincing set of economic data than usual to avoid the risk of reacting to any false signal.

“This is a very particular cycle, one that comes with much greater uncertainty than in other periods, both externally and domestically. As a result, leading indicators (ahead of interest rate movements) tend to be noisier and often give false signals,” he said at an event hosted by the Camara de Comercio Espanhola in Sao Paulo.

“Given the current level of uncertainty, volatility, and specific circumstances, this cycle requires a higher degree of conviction than usual. The Central Bank doesn’t want to risk reacting to noise,” he noted.

He emphasized that the next phase of monetary policy will depend on a series of data showing that the economy is following the expected course. “It won’t be a single data point.” (See MNI INTERVIEW - BCB To Hold Rates Until Q1 2026 - Schwartsman)