At a time of this significance in Brazilian political and economic life, the subject of ” Central Bank Independence” becomes fundamental for discussion and consolidation of investors’ perceptions and pundits regarding the monetary authority. Brazil is one of the last countries to set up its Central Bank – at least 20 years, from the creation of the Currency and Credit Oversight Board (SUMOC) in 1945 until its official installation in 1964. Then, it took more than two decades to become the sole monetary authority of Brazil. Single, double or multiple mandates, order and transparency need to prevail without ever forgetting its first “raison d’être”: ensuring the stability of the currency’s purchasing power and the efficiency of the financial system!
The following article tries to present some of the ways that a Central Bank must tread to guarantee its Mission, as well as to envisage possible behaviors in view of the ongoing scenario in Brazil.
Have a good read!