, in the rest the gap is still to be closed and inflation seems bounded ( figure 5 ). this has widened the differences regarding the expected evolution of monetary policy across economic blocs, triggering movements in interest rates and an appreciation of the dollar globally ( figure 6 ). this divergence was importantly confirmed at the federal reserve meeting yesterday, where along with the approval of the second increase in the federal funds rate for the year, it signaled it would speed up the normalization process foreseen for the next two years. one striking element in the way the external scenario has behaved in recent months is the stronger reaction to news of different sign. part of it was observed in february, due to higher than expected figures for wage growth in the united states. a similar phenomenon happened more recently relating to the configuration of the government in italy. although this is an important economy within the european union, it had not been common for interest rates, exchange rates and risk premiums to react in such a degree to similar events. this makes us think that changes in the markets ’ appetite for risk have made them more reactive to incoming news and the possibility of observing episodes of high volatility seems greater than in the past. in this context, financial conditions facing the emerging world have taken a downward turn. in recent weeks, currencies have depreciated against the dollar and capital flows have fallen. the chilean peso has followed the global trend, posting a depreciation since the close of the march report, which in the last few days has fluctuated around 630 pesos per dollar, which amounts to an increase of more than 4. 5 %. the multilateral exchange rate measures — where the evolution of the peso is compared to a broader set of currencies — show a more limited nominal depreciation. compared with the currencies of other commodity exporters, the depreciation of the peso has been similar, while it has been in the lower side of the variations in latin american economies ( figure 7 ). the fact that the peso depreciation responds to a global phenomenon also implies that the real exchange rate ( rer ) has increased moderately with respect to the level it has shown since the beginning of the year and with a real depreciation similar to those of other comparable economies, standing around 90 in the 1986 = 100 index towards the statistical closure of this report. our baseline scenario assumes that the rer will return to near its average of the last fifteen

the ssm would ensure shared ownership of problems and decisions, encouraging a broader vision on the implications of the ssm ’ s decisions on financial stability. this could be achieved through the establishment of intermediate committees similar to those of the ecb ’ s monetary policy function. the separation of supervisory functions from regulatory ones is necessary for the political legitimation of regulatory standards. the overlap of regulatory and supervisory territories guarantees compliance with the principle of central responsibility for financial stability. in this 1 / 2 bis central bankers'speeches context, it is necessary to find ways to ensure and safeguard this basic principle within banking union. it is also essential to determine which coordination and convergence mechanisms between territorial regulatory and supervisory authorities can be established between the banking union and the remaining eu member states. one should not underestimate how much has been achieved in recent years. nevertheless, the foundations of europe ’ s financial architecture are still not sufficiently robust to withstand the impact of a future crisis. this should be a priority for policy - makers and relevant institutions. decisive political will to move forward with the completion of the banking union is required. in the absence of this will, europe must revisit its existing rules to safeguard financial stability. this is in the best interests of its people as few things can be more destructive to citizens ’ trust in european institutions than threats to financial stability. 2 / 2 bis central bankers'speeches