BRASILIA, March 28 (Reuters) - Brazil's central bank
said that the Finance Ministry's commitment to implementing
fiscal measures and the reinstatement of fuel taxes smooths the
fiscal stimuli on demand, reducing the upside risk on inflation
in the short-term, according to minutes from its last policy
meeting on Tuesday.
In the minutes of the meeting held between March. 21-22,
when the rate-setting committee known as Copom kept the
benchmark rate at 13.75%, policymakers said that there is no
mechanical relationship between the convergence of inflation and
the presentation of an awaited fiscal framework. Still, they
stressed that a credible new rule "might result in a more benign
disinflationary process through its effect on the expectations
channel."
(Reporting by Marcela Ayres; Editing by Steven Grattan)
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