Brazil Needs More Tools to Fight Inflation, Lula’s Adviser Says
- Guilherme Mello says recession mustn’t be anti-inflation tool
- Grain stockpiles, new fuel policy needed to curb price swings
A customer shops for meat for sale at the Zona Sul grocery store in Rio de Janeiro, Brazil.
Photographer: Dado Galdieri/BloombergThis article is for subscribers only.
Brazil needs tools beyond interest rates to rein in price shocks that have pushed inflation above 10% for the first time in nearly six years, according to an economic adviser to presidential front-runner Luiz Inacio Lula da Silva.
Guilherme Mello, 38, who’s part of a diverse group of economists who have the former president’s ear, said Brazil lost the ability to smooth out wild swings in prices of food and fuels when the government downsized its agriculture agency Conab and changed the focus of state-owned Petroleo Brasileiro SA, making it more dependent on imports.