Goldfajn pledges to hit Brazil inflation target, names board

Bloomberg

Brazil’s new central bank president IlanGoldfajn pledged to hit the center of the inflation target, while nominating members to his board that include a banker from the private sector.
“The objective is to fully meet the inflation target established by the National Monetary Council, looking at its center,” said Goldfajn, 50, during a ceremony to mark his taking of office.
The range of tolerance of currently plus or minus 2 percentage points is designed to account for shocks in consumer prices, Goldfajn said.
Inflation has remained above the 4.5 percent center of the range since September 2010 and higher than the 6.5 percent ceiling since the start of 2015. The target and range are set by the National Monetary Council, which is made up of government officials including the central bank president and finance minister.
The central bank president by law must submit a letter to the finance minister if inflation closes the calendar year outside the target range, explaining why he fell short. Analysts surveyed by the central bank forecast Goldfajn will be forced to write such a letter, with inflation ending 2016 at 7.2 percent. Consumer prices rose 9.3 percent in May from last year.
The Senate last week approved Goldfajn as Acting President Michel Temer’s replacement for AlexandreTombini. Goldfajn on Monday also nominated the following to his board:
Reinaldo Le Grazie, head of asset management at private Brazilian bank BancoBradesco SA, as monetary policy director; TiagoBerriel, a professor at the Pontifical Catholic University of Rio de Janeiro, as international relations director; Carlos Viana de Carvalho, also a professor at the Catholic University, as economic policy director; and Isaac Sidney Menezes Ferreira, the central bank’s attorney general, as institutional relations director.