BRASILIA (Reuters) – Brazil’s central bank would adopt a more aggressive forward guidance policy if the economy were to need more stimulus, rather than cut interest rates further or buy bonds, the bank’s economic policy director Fabio Kanczuk said on Friday.
Speaking in an online live event hosted by newspaper Valor Economico, Kanczuk said the central bank was a “long way” from that right now but made clear his reluctance to cut rates due to financial stability risks, and said quantitative easing would only be done to tackle market dysfunction, not as a monetary policy tool.
(Reporting by Jamie McGeever and Isabel Versiani)
