Brazil Adopts Continuous Inflation Target System

Brazilian President Luiz Inacio Lula da Silva signed a decree establishing a continuous inflation target starting in 2025, with quarterly accountability by the central bank. The target will be considered missed if annual inflation deviates for six consecutive months from the tolerance interval. The National Monetary Council sets the target, maintaining the existing 3% goal from 2024 to 2026. This change allows for a longer-term approach to accommodate price shocks without immediate monetary tightening. The move aims to enhance economic stability and transparency in Brazil's monetary policy framework.