. 6 1. 5 4. 9 goods and services imports 12. 2 - 14. 3 28. 5 6. 9 current account ( % gdp ) - 1. 5 2. 6 0. 3 - 1. 4 ( f ) forecast. source : central bank of chile. figure 8 indicadores de inflacion ( annual change, percent ) - 3 - 3 cpi cpix cpix1 cpi minus foodstuffs and energy sources : central bank of chile and national statistics institute ( ine ). bis central bankers ’ speeches table 3 inflation ( annual change, percent ) 2010 ( f ) 2011 ( f ) 2012 ( f ) average cpi inflation december cpi inflation cpi inflation in around 2 years ( * ) 8. 7 7. 1 1. 6 - 1. 4 1. 4 2. 8 3, 0 3. 3 3. 0 average cpix inflation december cpix inflation cpix inflation in around 2 years ( * ) 8. 4 8. 6 2. 8 - 1. 8 0. 5 2. 3 2. 7 3. 1 3. 1 average cpix1 inflation december cpix1 inflation cpix1 inflation in around 2 years ( * ) 7. 8 7. 7 2. 8 - 1. 1 - 0. 7 - 0. 1 2. 0 3. 0 3. 0 3. 0 3. 0 3. 0 ( f ) forecast. ( * ) inflation projected at fourth quarter of 2012. source : central bank of chile. grafico 9 inflacion ipc ( * ) ( annual change, percent ) eee : expectativas de inflacion ( porcentaje ) - 2 - 2 - 4 - 4 ipom sep. 2010 ipom dec. 2010 at december 2010 one year ahead at december 2011 two years ahead ( * ) gray area, as from the fourth quarter of 2010, indicates forecast. sources : central bank of chile and national statistics institute ( ine ). bis central bankers ’ speeches figure 10 nominal exchange rate ( index, 2 - jan - 2006 = 100 ) real exchange rate ( index, 1986 = 100 ) oer mer 88 92 96 00 04 08 rer 1990 - 2009 average 1995 - 2009 average mer - 5 ( 1 ) vertical dashed line marks date of publication of the september 2010 ipom. ( 2 ) information at 16 december 2010. source : central bank of chile. figure 11 mpr and expectations ( percent ) forward september 2010 ipom forward december

jose de gregorio : the central bank of chile ’ s financial stability and monetary policy speech by mr jose de gregorio, governor of the central bank of chile, before the senate at the presentation of the financial stability and monetary policy report, valparaiso, 20 december 2010. * * * introduction mr. president of the finance committee, senator camilo escalona, honorable senators, i am grateful for the committee ’ s invitation to the board of the central bank of chile to share our vision on recent macroeconomic and financial developments, their outlook and implications for monetary policy. they make up the content of our monetary policy report ( ipom ) of december 2010 and our financial stability report ( ief ) for the second - half 2010. when we presented our third ipom of the year last september, we said that expansionary policies applied during 2009 had borne fruit and set the ground for sound growth in the chilean economy. today, we see that as a result our country will grow by around 5. 2 % this year, despite the effects of the earthquake and tsunami of last february. also, prospects for 2011 are favorable, with projected growth in the range of 5. 5 to 6. 5 %. inflation has approached the 3 % target, but more gradually than foreseen. in this behavior there have been transitory factors related with the peso appreciation since mid - year. our projections are consistent with inflation hovering around the 3 % target during the next 24 months. chile is facing an unusual international scenario. on the one hand, the recovery of developed economies goes on, but only moderately and insufficiently to reduce the high rates of unemployment ( figure 1 ). risks are substantial. in fact, the intensity and velocity of the events we saw in europe in early november are proof of the fragility of the world economy. on the other hand, growth prospects in emerging markets are still positive ; commodity prices are still high, with copper standing out recently at record highs, and external financing conditions are good. the sustainability of this imbalanced scenario for the global economy is one of the primary risk factors for next year. some of the questions we must try to answer and monitor closely are : how fast can emerging economies grow if the advanced economies are further weakened? how can advanced economies grow without incurring in unsustainable current - account deficits? how will the financial tensions in europe be resolved? is it possible for expenditure in chile to grow excessively while ignoring the