BCB Director David says we have seen signs that monetary policy is working; we are in the process of calibrating interest rates

Director David's comments suggest a cautious optimism about the effectiveness of current monetary policy in addressing economic conditions.

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BCB Director David says we have seen signs that monetary policy is working; we are in the process of calibrating interest rates

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  • Labour market is tighter than ideal, but we know it is the last one to come back.
  • We are not going to bring inflation down through currency moves.
Context

His acknowledgment of a tighter labor market indicates a recognition of potential inflationary pressures, yet emphasizes that currency interventions will not suffice to combat inflation, which may signal a gradual approach to interest rate adjustments. Overall, this could imply a more measured path ahead for rates as the central bank calibrates its policy response.

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