Lula Criticizes Central Bank Chief Campos Neto, Petrobras Dividend

Fernando Travaglini
·2 min read
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(Bloomberg) -- Brazil President Luiz Inacio Lula da Silva once again criticized central bank head Roberto Campos Neto over the benchmark interest rate, in comments made during an interview with SBT TV on Monday night.

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“There is no explanation for the Selic interest rate to be 11.25%. There is no economic explanation, no inflationary explanation, there is nothing, nothing, other than the stubbornness of the president of the central bank in maintaining this interest rate,” Lula said.

Lula stated that he imagined that the bank president, with whom he has “civilized conversations,” would be “a little more prudent and faster.” “Because this citizen, when he leaves the central bank, he will have to measure what he did for this country, because, in fact, what he is doing right now is contributing to the delay in the economic growth of this country.”

The central bank’s monetary policy committee, Copom, meets next week to decide the interest rate. The pricing of the swap rates indicates at least two more cuts of 50 basis points, with the cycle ending at around 9.5% this year.

Petrobras

Domestic assets worsened in the final stretch of Monday’s trading session under the weight of Petrobras shares, which extended declines on statements from Lula. He once again criticized the amount of dividends paid by the state-owned oil giant, and said that the company does not have to think only about shareholders, but rather about common Brazilians, in the same interview with SBT.

Lula met with Petrobras CEO Jean Paul Prates on Monday afternoon. The removal of the Petrobras CEO from the role was not discussed at any time, Brazil’s Mining and Energy Minister Alexandre Silveira told journalists in Brasilia after the meeting.

Finance Minister

“The Finance Ministry did not draft the 2024 budget counting on the distribution of extraordinary dividends by Petrobras — if they are distributed, they improve our condition, but we are not depending on them,” said Finance Minister Fernando Haddad, who also attended the meeting.

The Brazilian government will appoint Finance Ministry secretary Rafael Dubeux for a seat on Petrobras’s board of directors, according to the ministry. The goal is for Dubeux to help the company with its energy transition plans.

Other Highlights

  • President Lula’s disapproval rose 9 points to 34% in the city of Sao Paulo, according to Datafolha

    • Research was carried out in the city of Sao Paulo between March 7-8, with 1,090 interviews; margin of error is 3 points

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