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Reforms are essential to keep interest and inflation under control, BC assesses

Copom Minutes

Document involves evaluations of the board of the Central Bank on the economy and decision on basic interest rate, the Selic

In the minutes of the meeting where the Selic interest rate was reduced to 7.5% a year, the Central Bank considered that economic reforms are essential to keep interest and inflation under control.

For the institution, possible frustration of the economic reforms can raise the risk, impacting the inflation and the interest policy of the Central Bank.

The board also considered that the process of interest reduction will depend on economic activity and inflation expectations in view of the risks to the conduct of economic policy. That is, of events that may result in increased inflation.

"The approval and implementation of reforms, notably those of a fiscal nature, and adjustments in the Brazilian economy are fundamental for the sustainability of the environment with low and stable inflation," said the document, released on Tuesday.

According to the Central Bank, this scenario is important for the continuity of monetary policy and reduction of structural interest rates, "with broad benefits for society."

Considered essential for rebalancing public accounts, the Pension Plan provides for the adoption of a minimum age of 65 for men and 62 years for women to access the benefit as a way to stop the exaggerated growth of social security accounts.

Source: Government of Brazil, with information from the Central Bank