BRASILIA: Brazilian President Luiz Inacio Lula da Silva on Thursday voiced support for government non-interference in monetary policy and the pricing strategy of state-run oil giant Petrobras, in market-friendly remarks that followed a drop in his approval ratings.
Speaking at a press conference, Lula also said that if additional fiscal measures are needed during the year, "we will consider them," amid growing market concerns over Brazil's rising public debt.
The leftist leader said central bank chief Gabriel Galipolo "did what he thought was necessary" after policymakers raised the key interest rate by 100 basis points to 13.25% on Wednesday.
Lula said Galipolo, who he appointed to lead the central bank earlier this month, would set the conditions for lowering interest rates "at the appropriate time" and would have full autonomy in his role.
Amid reports that Petrobras was considering a diesel price hike, Lula stressed that the decision rests with the company, "not the president." "Petrobras does not need to tell me (about fuel price tweaks). If Petrobras decides that it is important to make an adjustment, then they can do it," he said.
A Genial/Quaest poll released this week showed Lula's approval ratings slipping, with disapproval surpassing approval for the first time in two years, driven by rising food prices, concerns over increased taxation, and financial market volatility.
When asked about measures to ease food-related inflation, Lula ruled out steps that could lead to the creation of a black market. "What we can do is increase production of everything we can produce," he said.
The Brazilian real pared some earlier losses after Lula's remarks, trading down about 0.4% against the U.S. dollar, while the benchmark Bovespa stock index extended gains, rising 1.8%.
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