Brazil central bank could withdraw forward guidance even if spending cap intact -Campos Neto

BRASILIA, Nov 5 (Reuters) - Brazil’s central bank could withdraw its “forward guidance” pledge to keep interest rates low for a long time if the government honors its spending cap but uses creative ways to increase spending, central bank president Roberto Campos Neto said on Thursday.

Speaking in an online event hosted by the ProPague Institute, Campos Neto said Brazil’s interest rate curve is closely tied to the country’s fiscal credibility, adding it is important to bring down longer-term borrowing costs to spur private sector investment. (Reporting by Jamie McGeever and Marcela Ayres Editing by Chris Reese)

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