The Central Bank of Brazil plans to use CBDC data to guide national interest rate benchmark decisions.
The Central Bank of Brazil is planning to use the transaction data from its Central Bank Digital Currency (CBDC) infrastructure, Drex, to guide the setting of the country's Interest Rate Benchmark.
On June 4th, Central Bank Governor Henrique Videira stated at the Token Nation conference in São Paulo that every payment and asset transfer recorded on the Central Bank's infrastructure Drex distributed ledger will generate a structured entry with a timestamp.
By aggregating these entries, the monetary authority aims to measure changes in consumption, liquidity conditions, and industry performance in near real-time, and input these indicators into existing models before each monetary policy committee meeting.
Videira also emphasized that Drex only stores hashed personal identifiers to prevent individual tracking and ensure privacy protection. The plan expands the strategy of Brazil's Central Bank to use on-chain evidence to supplement investigations and banking system metrics.
He outlined the workflow, where anonymous Drex data is merged with wholesale settlement flows on the same ledger through internal filters, and appears on the policy dashboard for tracking merchant category spending, collateral changes, and regional trade volumes.
This method is also seen as an upgrade to analytical methods, rather than handing decision-making power over to algorithms. Videira stated that for borrowers with limited bank credit history, loan institutions can be authorized to review their Drex cash flow records to provide auditable proof of income without the need to submit pay stubs.
The Central Bank of Brazil encourages institutions to build an analytical layer in Drex, by labeling ledger fields for AI pattern recognition, and allows agricultural and public health institutions to use anonymous datasets to simulate disease transmission to improve crop yields.
It is reported that the Drex pilot project has entered a limited production phase in March, with a total of 16 institutions testing tokenized public debt and deposit tokens.
In summary, the Central Bank of Brazil plans to use CBDC data to guide the country's Interest Rate Benchmark decision-making, which not only enhances the timeliness and accuracy of decision-making but also aims to strengthen financial inclusion, providing fairer and more efficient financial services for all social strata.
Do you think that the Brazilian Central Bank's innovative initiative can provide a model worth learning from for other countries? Leave a comment in the discussion area!
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The Central Bank of Brazil plans to use CBDC data to guide national interest rate benchmark decisions.
The Central Bank of Brazil is planning to use the transaction data from its Central Bank Digital Currency (CBDC) infrastructure, Drex, to guide the setting of the country's Interest Rate Benchmark.
On June 4th, Central Bank Governor Henrique Videira stated at the Token Nation conference in São Paulo that every payment and asset transfer recorded on the Central Bank's infrastructure Drex distributed ledger will generate a structured entry with a timestamp.
By aggregating these entries, the monetary authority aims to measure changes in consumption, liquidity conditions, and industry performance in near real-time, and input these indicators into existing models before each monetary policy committee meeting.
Videira also emphasized that Drex only stores hashed personal identifiers to prevent individual tracking and ensure privacy protection. The plan expands the strategy of Brazil's Central Bank to use on-chain evidence to supplement investigations and banking system metrics.
He outlined the workflow, where anonymous Drex data is merged with wholesale settlement flows on the same ledger through internal filters, and appears on the policy dashboard for tracking merchant category spending, collateral changes, and regional trade volumes.
This method is also seen as an upgrade to analytical methods, rather than handing decision-making power over to algorithms. Videira stated that for borrowers with limited bank credit history, loan institutions can be authorized to review their Drex cash flow records to provide auditable proof of income without the need to submit pay stubs.
The Central Bank of Brazil encourages institutions to build an analytical layer in Drex, by labeling ledger fields for AI pattern recognition, and allows agricultural and public health institutions to use anonymous datasets to simulate disease transmission to improve crop yields.
It is reported that the Drex pilot project has entered a limited production phase in March, with a total of 16 institutions testing tokenized public debt and deposit tokens.
In summary, the Central Bank of Brazil plans to use CBDC data to guide the country's Interest Rate Benchmark decision-making, which not only enhances the timeliness and accuracy of decision-making but also aims to strengthen financial inclusion, providing fairer and more efficient financial services for all social strata.
Do you think that the Brazilian Central Bank's innovative initiative can provide a model worth learning from for other countries? Leave a comment in the discussion area!
#巴西CBDC # monetary policy #fintech