to remain weak. the slowdown in its private consumption and investment components stood out ( figure 1 ). another important development of recent months came from abroad. mainly, because the external impulse that the chilean economy will face in 2016 and 2017 will be lower than we expected in december. the new information leads us to estimate that global growth will fall short of expectations, because of both downward corrections to projected activity in the developed world and a major adjustment in latin america, which is headed to a contraction in 2016. at the same time, the external financial conditions relevant for chile are estimated to be tighter, while the terms of trade will be lower ( figure 2 and table 1 ). bis central bankers ’ speeches the downscaling in output projections for 2016 is consistent with the lower base at the end of 2015, and with spot indicators suggesting that consumption and investment have remained weak this year to date. on the consumption side, in the last two years the real wage bill has been outgrowing private consumption, leading us to expect a somewhat stronger recovery of the latter during this year. this has not happened, however, which together with the sharper deterioration of the labor market in recent months, plus consumers ’ expectations remaining pessimistic and low levels of imports of consumer goods in the first months of the year, mean that this component of growth has to be revised downward. however, by 2017 some recovery of this variable is expected, thanks to a gradual improvement in its fundamentals, particularly, moderate growth in the wage bill and a slight improvement in consumer expectations. investment, on the other hand, has seen a significant adjustment in recent years, due primarily to the end of the mining investment cycle ( figure 3 ). the baseline scenario of this report reduces the growth outlook for gross fixed capital formation. this new estimate assumes that mining investment will remain near its levels of 2015. also, that the boost that the coming into force of the vat on construction gave to housing investment will be diluted as time passes. add to this the lower impulse coming from public investment associated with the recently announced fiscal adjustment. other investments should recover gradually over the projection horizon, to the extent that expectations and external demand improve. meanwhile, in line with the expected slowdown of our trading partners, exports are also revised downward from december. manufacturing shipments will be most affected, considering that their destinations are more concentrated in latin america, and some sectors, such as salmon, have been beset by specific factors. on the imports side

the upper bound of the tolerance band. of course these numbers describe a complex economic scenario, which makes us wonder what caused it and how we have dealt with it. let me use the last minutes of my intervention bis central bankers ’ speeches to visit these topics briefly, and go in more detail into how monetary policy has behaved in this adverse economic environment. many factors lie behind our low growth, some of which have been more intense than previously thought. lately, this has led not only us but also market analysts and international organizations to make significant downward corrections to the growth outlook for chile. just as a reference : in march 2014, 90 percent of the analysts consulted under our economic expectations survey thought that gdp would grow by 4 percent or more in 2016. two years on, 90 percent are betting on less than 2. 1 percent. what caused this change in the forecast? to begin with, the world economy is undergoing an important process of reconfiguration, which entails deep changes that have proven not only more intense, but also of a much more persistent nature than expected. among them, it is worth singling out the evolution of the chinese economy and its major effects on the commodity markets. the effects of this phenomenon have reflected strongly in a sharp reduction in mining investment, of nearly three points of gdp in the past few years, putting a brake in our economy, especially considering that in previous years this sector was an important driver of growth. the situation in china has not only affected the prices of commodities. in addition, the uncertainty surrounding the changes in the chinese economy has driven up global risks. after all, never had an emerging economy played such an important role in the world economy. secondly, the global financial crisis of 2008 hit the developed economies harder than we originally thought. the wounds it left have constrained their economic recovery and pushed them to experiment with ultra - expansionary monetary policies. this, coupled with the fragilities of many emerging economies, has led this group of countries to face tighter financial conditions than they did some quarters ago. the weakness of the world economy and the higher volatility in global financial markets has certainly taken a toll on economic expectations. but in chile, the business climate has also been affected by the years - long debate about what changes we must make to meet the challenges of being a middle - income country in the twentieth century aspiring to become developed in the shortest time possible. in my opinion, it would be self - indulgent to blame all our problems