Brazil's inflation progress not enough for target, says central bank chief

By Marcela Ayres

BRASILIA, Dec 1 (Reuters) -

Brazil's central bank chief Gabriel Galipolo said on Monday that inflation expectations and forecasts have improved but remain short of the bank's 3% target, while arguing there is no need to signal any policy shift.

"Data show we are not yet where our mandate requires," he said at an economic conference hosted by brokerage XP in Sao Paulo. "We have no indication of the next step because we are still in a phase of continuous assessment."

The central bank has held interest rates steady since July at 15%, the highest in nearly two decades, after an aggressive tightening cycle to curb inflation.

Policymakers meet for the final time this year next week. While markets broadly expect another pause, investors are scrutinizing any signal on when easing might begin as Latin America's largest economy cools.

Galipolo said he does not see an obligation for the bank to signal in advance when it plans to move.

He added that assessing labor-market dynamics has been challenging, but that across various indicators, "it's hard to argue the job market isn't overheated."

He also noted that the size of Brazil's current account deficit and strong Black Friday sales point to resilient economic activity, citing a record number of transactions on the central bank's Pix instant payments system on Friday.

All these factors, he said, "reinforce our humble and conservative stance," with policymakers guided strictly by data. (Reporting by Marcela Ayres Editing by Bernadette Baum and Gabriel Araujo)