Marcelo points out the political consequences of rising interest rates, arguing that it favors “more populist positions” ahead of the European elections. And he admits that the Government “has done what it could.”
The President of the Republic, Marcelo Rebelo de Sousa, expressed “concern” about the new increase announced this Thursday of 25 basis points in the official interest rates of the European Central Bank (ECB) and pointed to the possible political consequences. “I am concerned that this will happen very close to the end of the year. If there are no conditions for the resumption next year, facing the time horizon of the European elections [marcadas para junho de 2024]favors more radical positions Is populists.”
On the second day of his visit to Canada, Marcelo Rebelo de Sousa stressed that it is necessary to “reconcile medium and long-term objectives with the management of short and long-term objectives,” pointing out that voters “They are very sensitive to immediate day-to-day problems.”
In this sense, the Head of State indicated that he is also concerned “the successive positions of the ECB” about reductions in “social aid”, while “stating that growth could be harmed and that this could have more or less immediate consequences.” “There has to be a balance here. The position of the European Central Bank is very strict.”
Marcelo Rebelo de Sousa recalled that people’s lives are made up of “economic, social and political decisions.” “This is penalizing for all governments,” he lamented. However, the President of the Republic praised the Portuguese Executive for “having done what it could in terms of social aid” in what he considers a “straitjacket.”
Drawing a comparison to an “English horse whose feed was cut off” for discipline and which was later found to be “too weak,” Marcelo Rebelo de Sousa stressed that “it would not be advisable for Europe to remain weak in the economic recovery.” This, in the opinion of the President of the Republic, could have “social and political consequences”: “The political systems pay for this.”
“We will see if this changes next month,” said Marcelo Rebelo de Sousa, recalling that economists only deal with theory and not with “political-social reality.”
This is the tenth consecutive increase in interest rates by the central bank, which has increased rates by 450 basis points since July last year, the fastest upward cycle in the history of the euro zone and which aims to reduce inflation up to 2%.
Source: Observadora
