Director of the Central Bank says that the tragedy in Rio Grande do Sul could affect the economy

Paulo Picchetti, director of International Affairs and Corporate Risk Management at the Central Bank, announced on the 7th, this Friday, that the tragedy caused by the storms that occurred, at the beginning of this year, in Rio Grande do Sul will have an impact in the price of products. According to him, the preliminary calculations that will be used to measure the impact of the tragedy are already being made by the monetary authority. During a seminar at FGV (Fundação Getúlio Vargas), which took place in the city of São Paulo, he stated that “it worries us in the short term, but it has a long-term effect”.

Ecological change

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_{Paulo Picchetti at a conference (Photo: reproduction/Julia Nikhison/GettyImages Embed)}

Paulo Picchetti also stated that, around the world, central banks from other countries are focusing on processes of ecological change and took the opportunity to warn that problems in relation to this type present the possibility of affecting the mandates of the Brazilian Central Bank, in relation to the preservation of purchasing power and the balance of the finance system.

GDP

According to Paulo Picchetti, in the first quarter GDP (Gross Domestic Product) was surprisingly good and had an excellent composition, also pointing to the recovery of investments at the high end and also the recovery of private consumption.

Furthermore, looking at the growth rate that could increase GDP revisions for this year, he states that it could rise up to 2%. Regarding domestic inflation, the BC director highlighted that there is a disinflation process, which is valid both in the full indicator and in the core averages.

He also expressed that industrial goods have a calmer dynamic. However, Picchetti took the opportunity to confirm that there is concern regarding the inflation of services and said that, even though it is declining, it still remains within the target.

Featured photo: Picchetti talks about the Central Bank and its goals (Reproduction/Maira Erlich/GettyImages Embed)