Let me finish by thanking Alejandra Rozas, Camila Figueroa, Paloma Navarro, María José Reyes, Felipe Leal and both the Public Affairs Department and the Research Department for all their invaluable help managing the challenging logistics of organizing these two conferences together. Thank you, have a pleasant stay in Santiago and a fruitful discussion over the next two days. *** References Berggren, N., S.-O. Daunfeldt, J. Hellström (2014), “Social Trust and Central-Bank Independence,” European Journal of Political Economy 34: 425-439. Bholat, D., N. Broughton, A. Parker, J. Ter Meer, and E. Walczak (2018), “Enhancing Central Bank Communications with Behavioural Insights,” Staff Working Paper 750, Bank of England. Hayo, B. and F. Neumeier (2017), “Explaining Central Bank Trust in an Inflation Targeting Country: The Case of the Reserve Bank of New Zealand,” Working Paper 236, ifo Institute. Christelis, D., D. Georgarakos, T. Japelli, and M. van Rooij (2016), “Trust in the Central Bank and Inflation Expectations,” Working Paper 537, De Nederlansdsche Bank. International Monetary Fund (2018), World Economic Outlook, Chapter 3, Challenges for Monetary Policy in Emerging Markets as Global Financial Conditions Normalize, October 2018. Mellina, S. and T. Schmidt (2018), “The Role of Central Bank Knowledge and Trust for the Public's Inflation Expectations,” Discussion Paper 32/2018, Deutsche Bundesbank. Organisation for Economic Co-operation and Development (2017), Trust and Public Policy. How Better Governance Can Help Rebuild Public Trust, OECD Public Governance Reviews, OECD: Paris. Page 8 of 8

That has included work on the specific issues of leverage and liquidity of LDI strategies, which was assessed with a stress simulation in 2018, and which led to further close work with the Pensions Regulator and the Financial Conduct Authority[14] to enhance understanding of financial stability risks, enhance monitoring and inform further work. The vulnerabilities in market-based finance that the FPC had articulated were exposed in dramatic fashion in the ‘dash for cash’ in the early stages of the Covid pandemic. [15] That gave additional momentum to this work. And there has been some progress in recent years, on the regulation and monitoring of the non-bank sector[16], particularly relating to liquidity mismatches in MMFs and OEFs. [17] The international community has made less progress in addressing the risks from non-bank leverage. The international nature of leveraged investors requires a firm response by the global regulatory community to assess those risks and develop policy solutions. And the UK’s recent experience is a timely reminder of the risks here. So in the final minutes I will zone in on the actions relevant to this issue. Let’s start with transparency, where it is vital that regulatory authorities have sight of leverage building up in the system, and what that means for resilience. That requires better regulatory disclosures for non-banks and investment in monitoring capabilities. The Bank has access to transaction-level data from regulatory datasets[18] which we use to monitor the build-up of systemic risks stemming from leverage in the non-bank system.