embargo on iranian exports, and a harsh winter in the northern hemisphere have made the actual and expected oil price to escalate. the brent price has risen more than 15 % during the current year, while projections taken from futures contracts have also risen and point to an average price for oil of near us $ 120 per barrel during 2012. the persistence of a high price always raises worldwide concern because of its implications on inflation and growth. concerns regarding inflation deal with the direct impact of fuel and energy inflation, and also with the secondary effects that they cause, which could be accentuated in an environment with a narrow output gap. final thoughts before i end my presentation, i would like to share some thoughts on monetary policy. as mentioned at the beginning of this presentation, our task as economic policymakers is made more difficult in a more uncertain environment. we make our best decisions based on whatever information is available at the moment. currently, decision making relies on certain elements that point to opposite directions. on one hand, the international scenario is very complex, even though when compared to a few months back, the tensions seem somewhat smaller. nonetheless, depending on the outcome of events, there could be contractive effects on emerging economies. scenarios such as this back slacker monetary policies. on the other hand, the domestic scenario poses challenges in the opposite direction, inasmuch as the behavior of domestic demand may bring inflationary risks. today, prudent monetary policy management has to be prepared for all kinds of scenarios and to adapt the amount of stimulus applied according to needs established on a case by case basis. in fact, in our latest monetary policy meeting we decided to maintain the monetary policy rate at 5 % for a second month in a row. the greater caution in policy decisions that these events pose has been reflected in the fact that private expectations currently incorporate a higher probability of mpr to remain at 5 % until the end of the year. with the board we have conditioned future changes in mpr to the implications that domestic and external macroeconomic conditions may have on inflation perspectives. the board has also reaffirmed its commitment to conduct monetary policy in a flexible fashion, so that projected inflation remains at 3 % within the policy horizon. without a doubt, the best contribution that central bankers can make to prosperity in our countries is to conduct monetary policy aimed at maintaining low and stable inflation. this is perfectly clear for us at the central bank of chile. as emerging economies we are long - time victims of inflation

2 - 2 - 4 - 4 - 6 - 6 - 8 - 8 cpi cpiefe cpiefe goods cpiefe services sources : central bank of chile and national statistics institute ( ine ). figure 2 gross domestic product ( annual change, percentage ) 5. 5 5. 5 5. 0 5. 0 4. 5 4. 5 4. 0 4. 0 3. 5 3. 5 dec. 11 mar. 12 ees gdp 2012 jun. 12 range mp report sep. 12 dec. 12 dec. mp report forecast source : central bank of chile. bis central bankers ’ speeches table 1 economic growth and current account ( annual change, percentage ) 2012 ( f ) 2013 ( f ) mp report mp report mp report mp report sep. 12 dec. 12 sep. 12 dec. 12 gdp 6. 0 4. 75 - 5. 25 5. 5 4. 0 - 5. 0 4. 25 - 5. 25 domestic demand domestic demand ( w / o inventory change ) gross fixed capital formation total consumption exports of goods and services imports of goods and services 9. 4 10. 2 17. 6 7. 9 4. 6 14. 4 5. 6 5. 5 7. 0 5. 1 3. 5 4. 0 6. 6 6. 8 11. 3 5. 3 2. 7 5. 5 5. 5 5. 8 7. 1 5. 4 3. 6 5. 8 5. 7 6. 0 7. 6 5. 5 3. 0 5. 9 current account ( % of gdp ) - 1. 3 - 3. 2 - 3. 8 - 4. 4 - 4. 6 ( f ) forecast. source : central bank of chile. table 2 international baseline scenario assumptions growth trading partners world at ppp 2012 ( f ) 2013 ( f ) 2014 ( f ) mp mp mp mp mp mp report report report report report report sep. 12 dec. 12 sep. 12 dec. 12 sep. 12 dec. 12 ( annual change, percentage ) 4. 2 3. 5 3. 3 3. 8 3. 5 4. 3 4. 0 3. 8 3. 1 3. 0 3. 6 3. 3 4. 1 3. 8 united states eurozone japan china india rest of asia ( excl. japan, china & india ) latin america ( excl. chile ) 1. 8 1. 5 - 0. 7 9. 3 6. 5 4. 2 4. 4 external prices (