The unjustifiable Brazilian basic interest rate and the capture of the Central Bank by the financial market
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Abstract
If we observe the discussions about the high SELIC interest rate today, we will notice that the criticism of maintaining such a high level of this rate in Brazil takes shape in relation to previous historical moments. This is because the current world has specific characteristics, such as a high level of inflation, which comes from an oil shock and a post-pandemic period. Within this context, Brazilian inflation was lower and falling in relation to many advanced economies, such as, for example, the USA. And even so, our Brazilian Central Bank maintained a real interest rate of approximately 9%. It is important to highlight that behind the maintenance of this rate is the country's option to grow with external savings defined by Professor Luiz Carlos Bresser-Pereira and which finds support in interest groups that unite around a rent-seeking gain.
KEYWORDS: interest rates: capture; Central bank; oligarchies; rentism.
JEL Classification: E40; E44; E52; E58; E62
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