Brazil cenbank chief Campos Neto says replacing Economy Minister Guedes a non-issue

Brazil's Central Bank President Roberto Campos Neto looks on during a news conference at the Brazil Central Bank headquarters in Brasilia, Brazil

Brazilian central bank president Roberto Campos Neto said on Monday that he has not been sounded out about replacing Economy Minister Paulo Guedes when he eventually leaves his post, and said the whole notion is a “non-issue.”

In an interview with CNN Brasil, Campos Neto dismissed recent local media reports that he has been lined up to replace Guedes and said the reports only served as a distraction from getting the economy back up and running.

“My ideas are very closely aligned to Paulo Guedes’. I have never been approached. It would make no sense, given the alignment we have. I think it is a distraction,” Campos Neto said.

Asked if he would assume the role if Guedes left, Campos Netos said that would make no sense, precisely because the two men’s views on the economy and policy are so closely aligned.

“I think this is a non-issue,” he said.

Speculation that Guedes could quit has never been far from the surface ever since President Jair Bolsonaro took office in January last year, either due to differences of opinion with the president or frustration with the lack of progress for his sweeping orthodox, market-friendly economic and fiscal reforms.

On the issue of the public finances, an area where Campos Neto and Guedes are very closely aligned, the central bank chief said any deterioration in the fiscal outlook could prompt the bank to reevaluate its policy outlook.

Earlier on Monday, Campos Neto said economic and fiscal reforms help keep interest rates lower for longer, and that fiscal discipline anchors short- and medium-term rates.

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