legally mandated. let me end with some final thoughts. final thoughts as is customary in our presentations to the senate, we have tried to present as clearly and transparently as possible our assessment of the current economic situation and its implications for managing the policy tools entrusted to us. always keeping a watchful eye on the compliance of the mandates we have been given. the chilean economy is on a good stand to face the challenges ahead, which certainly does not mean that we feel immune to whatever happens beyond our borders. we have managed economic policies seriously and responsibly in good times, which should allow us to move with relative ease through a not so favorable period. the country ’ s domestic and external position is strong, our financial system has limited risks, and the monetary policy is in a position that, if necessary, can deal with a different, more complicated phase. in addition, a strong fiscal position with public debt that in net terms is virtually nil, something that not many countries can show. bis central bankers ’ speeches in the last two months we cut 50 basis points off the mpr, to 4. 5 percent. the scenario that today we see as the most likely does not envisages the need for significant additional adjustments to the policy rate. however, in a different scenario where further adjustments are called for, there is the room and the will to carry them out. we, as the central bank, will continue to contribute with our assigned duty, that is, to safeguard the stability of our currency and the normal functioning of the internal and external payment system, to chile ’ s development and welfare. many thanks, bis central bankers ’ speeches figure 1 gdp growth ( annual change, percent ) - 4 - 4 - 8 - 8 - 12 - 12 natural resources all other sectors source : central bank of chile. figure 2 private consumption and investment ( annual change, percent ) - 5 - 5 - 10 - 10 - 15 - 15 - 20 - 20 private consumption investment source : central bank of chile. bis central bankers ’ speeches figure 3 inflation indicators ( annual change, percent ) - 2 - 2 - 4 - 4 cpi ees two years hence cpisae sources : central bank of chile and national statistics institute ( ine ). table 1 international baseline scenario assumptions 2013 ( f ) mar. 13 sep. 13 report report growth trading partners'gdp world gdp at ppp 3. 4 3. 1 3. 6 3. 3 3. 3 3. 0 2014 ( f )

volatility originating in the monetary stimulus withdrawal is the most likely to occur. however, a deepening of the eurozone crisis or a sharp deceleration of a systemic emerging economy would have stronger effects on the chilean financial system. especially because, as i have noted, the withdrawal of the monetary stimulus in the united states will come about when the u. s. economy ’ s improved growth is already confirmed. the banking industry ’ s capital levels are adequate to remain solvent before a significant deterioration of economic growth and financial conditions. stress tests show that the banks ’ current capital levels allow them to absorb potential losses generated by a macroeconomic bis central bankers ’ speeches risk scenario that combines a gdp contraction – like that of the subprime crisis – higher financial costs for the short and long term, and a sharp depreciation of the exchange rate. one such test – motivated by the risk scenarios identified in the process of monetary tapering in the u. s. – shows little exposure of the banking system to a sharp increase in the interest rates of long - term securities. meanwhile, households ’ aggregate borrowing and financial burden indicators show a marginal decline, although with some changes in the composition of the debt. the share of bank debt has increased compared with other credit providers, while total corporate debt is stable as a ratio to gdp and the financial indicators of companies reporting to the superintendence of securities and insurance ( svs ) are also fairly stable. capital inflows to chile continue to be dominated by fdi while aggregate solvency and liquidity figures are also stable. in this way, our general analysis of the domestic financial system yields that it is on a good standing to deal with the risk scenarios described, and we see no incubation of systemic risks at the local level. this explains, in part, why the recent volatility episode in foreign financial markets had lesser effects on the chilean financial system than in other emerging economies, where risks did incubate over the past few years. however, to maintain this resilience the different players making up the financial system must take the necessary decisions and safeguards, especially considering the dynamism of the financial sector. one first firewall, perhaps the most important one, is the one related to corporate stockholders, who should establish and implement clear policies aimed at restricting their operating risks via corporate governance, boards and management. a second firewall is related to public institutions such as the superintendences and the central bank