Economics
Father of Brazil’s Inflation Targets Wants to Change the System
- Arminio Fraga proposes second mandate for Brazil central bank
- Idea is to smooth shocks to economic activity over 18 months
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The man who introduced inflation targeting in Brazil two decades ago says it’s now time to change the system that’s one of the pillars of the nation’s economic policy.
Former central bank chief Arminio Fraga suggests that the monetary authority should “smooth” economic cycles as part of a secondary mandate it would receive along with its independence, currently being discussed in Congress. That would be in addition to its main goal of price stability, and not to be mistaken with a growth target, he stresses.