Gabriel Galípolo at the Central Bank

Image: Brett Sayles


The presence of Galípolo in the BC will have faster results than the process of winning the majority of the Copom

The appointment of Gabriel Galípolo to the Central Bank's monetary policy board will have faster results than the process of winning the majority of the Central Bank's Copom (Monetary Policy Committee). The Copom is responsible for defining the basic interest rate, the Selic. There are eight members, plus the president of the Central Bank. At the moment, Minister Fernando Haddad will be able to place only two members.

Gabriel Galípolo could, however, play two relevant roles. First, as head of monetary policy. Of the eight Copom departments, Monetary Policy is the only one that operates directly in the market, being responsible for the implementation of open market operations, purchase and sale of public securities. In this role, and with his experience in the market, Gabriel Galípolo will be able to set another pace in operations. In recent years, the Central Bank has acted passively in the open market, in exchange rate policy, trailing behind the market.

It's no small thing. A rise in long-term interest rates, an oscillation in the foreign exchange market, are factors of instability, helping to consolidate Copom's convictions about interest rates.

There will be more challenges ahead. The way to control the liquidity of the system is through the so-called “committed operations” – the Central Bank sells securities to banks with the commitment to buy them back the next day. All these points make the public debt more expensive, already overloaded by the excesses of the Selic rate.

It is not known how far Gabriel Galípolo intends to dare. Especially since the second challenge – convincing the Copom to reduce the Selic rate – will depend on good argumentation skills and a good relationship with colleagues. And you will have good arguments ahead. One of them is the IGP-DI (General Price Index, Internal Availability) of Fundação Getúlio Vargas, which recorded deflation of 1,01% in April and 0,34% in March and 2,57% in 12 months.

Another is the IBGE's Extended Consumer Price Index (IPCA). The factor that weighed in the last IPCA was the transport item, which depends exclusively on administered prices. With Petrobras reducing prices, there will be deflationary impacts on the IPCA.

Finally, Galípolo's broad knowledge of the PPP market (Public-Private Partnerships) and partnerships between public credit and investment funds weighs in favor of Galípolo. And, more than that, the pressure from companies, given the collapse of relevant sectors – such as retail, health plans, food – suffocated by the credit crisis and the cost of capital.

Once again, political time conspires against this strategy. Lula continues to bet on international investments as a way out of circumventing the limitations imposed by the Central Bank of Roberto Campos Neto on the credit of public banks.

* Luis Nassif is a journalist, editor of Jornal GGN. Author, among other books, of the spreadsheet heads (Ediouro).

Originally published on GGN newspaper.

the earth is round exists thanks to our readers and supporters.
Help us keep this idea going.

See this link for all articles


  • About artificial ignoranceEugenio Bucci 15/06/2024 By EUGÊNIO BUCCI: Today, ignorance is not an uninhabited house, devoid of ideas, but a building full of disjointed nonsense, a goo of heavy density that occupies every space
  • Franz Kafka, libertarian spiritFranz Kafka, libertarian spirit 13/06/2024 By MICHAEL LÖWY: Notes on the occasion of the centenary of the death of the Czech writer
  • The society of dead historyclassroom similar to the one in usp history 16/06/2024 By ANTONIO SIMPLICIO DE ALMEIDA NETO: The subject of history was inserted into a generic area called Applied Human and Social Sciences and, finally, disappeared into the curricular drain
  • Strengthen PROIFESclassroom 54mf 15/06/2024 By GIL VICENTE REIS DE FIGUEIREDO: The attempt to cancel PROIFES and, at the same time, turn a blind eye to the errors of ANDES management is a disservice to the construction of a new representation scenario
  • Letter to the presidentSquid 59mk,g 18/06/2024 By FRANCISCO ALVES, JOÃO DOS REIS SILVA JÚNIOR & VALDEMAR SGUISSARDI: “We completely agree with Your Excellency. when he states and reaffirms that 'Education is an investment, not an expense'”
  • A look at the 2024 federal strikelula haddad 20/06/2024 By IAEL DE SOUZA: A few months into government, Lula's electoral fraud was proven, accompanied by his “faithful henchman”, the Minister of Finance, Fernando Haddad
  • Volodymyr Zelensky's trapstar wars 15/06/2024 By HUGO DIONÍSIO: Whether Zelensky gets his glass full – the US entry into the war – or his glass half full – Europe’s entry into the war – either solution is devastating for our lives
  • PEC-65: independence or patrimonialism in the Central Bank?Campos Neto Trojan Horse 17/06/2024 By PEDRO PAULO ZAHLUTH BASTOS: What Roberto Campos Neto proposes is the constitutional amendment of free lunch for the future elite of the Central Bank
  • Hélio Pellegrino, 100 years oldHelio Pellegrino 14/06/2024 By FERNANDA CANAVÊZ & FERNANDA PACHECO-FERREIRA: In the vast elaboration of the psychoanalyst and writer, there is still an aspect little explored: the class struggle in psychoanalysis
  • Introduction to “Capital” by Karl Marxred triangular culture 02/06/2024 By ELEUTÉRIO FS PRADO: Commentary on the book by Michael Heinrich