Brasília – The Brazilian Gross Domestic Product (GDP), i.e. the sum of all goods and services produced in the country, should grow by more than 5% in 2010, according to the Brazilian Central Bank’s president, Henrique Meirelles. He gave a press conference to radio stations on this Thursday (17th) in the studios of state-owned communication company Empresa Brasil de Comunicação (EBC), during radio show Bom Dia, Ministro (Good Morning, Minister).
To Meirelles, 2009 is ending as expected and there will be growth in 2010, "anchored on employment generation and increased credit." He emphasized that the growth will take place with the inflation under control.
According to Meirelles, should price pressure emerge, the Central Bank is prepared to make a decision in time. "The Central Bank is always alert to the risk of inflation. There is always a chance of some imbalance occurring between production capacity and consumption."
Meirelles added that the United States had to maintain a monetary policy of very low interest rates, resulting in lots of cash in circulation. According to him, this situation is going to lead to an imbalance in pricings and the currency. "We are being careful in order to prevent eventual imbalances from affecting Brazil."
He underscored, however, that financial market analysts’ projections point to an inflation rate in keeping with the 4.5% target for 2010, with a rate ranging from 2.5% to 6.5%. The Extended Consumer Price Index (IPCA) is the government’s reference for monitoring the target.
According to Meirelles, the expansion of credit next year is going to be balanced. "The growth is going to be healthy. We are adopting all regulatory and monitoring measures to prevent imbalances," he said. Some analysts are expecting credit to grow by more than 50%, compared with the GDP, in 2010.
*Translated by Gabriel Pomerancblum
