risks coming from abroad? in this context, the board has continued to gradually normalize the monetary policy interest rate ( mpr ), setting it at 3. 25 % in its december meeting. in the most likely scenario, it will continue to gradually withdraw the monetary stimulus, which will depend on the unfolding of internal and external macroeconomic conditions. let me now take a closer look at the scenario we believe is the most likely for the next two years and its implications for inflation and monetary policy. macroeconomic scenario i will begin with the world economy. after the global recession of 2009, the recovery has been imbalanced between developed and emerging economies. among developed ones, especially those that encountered problems in their financial systems during the crisis, are growing below trend. bis central bankers ’ speeches thus, the main developed economies are still enduring high unemployment rates. stimulus measures adopted during the recession helped the world economy to begin recovering. but private demand remains weak in the advanced world and inflation, both headline and core, is still contained. households, banks and governments in the main developed economies are facing a fragile financial situation. within this context, the process of de - leveraging and restoring the damaged balance sheets will take some time. such a scenario has called for additional monetary expansion measures and postponing interest rate normalization in those economies. the dollar has depreciated in global markets ( figure 2 ) while in the u. s., additional fiscal stimulus packages have been adopted and in europe fiscal adjustment plans are being applied. in emerging markets, especially in asia and latin america, economic activity has been growing strongly, although it is expected to converge to trend levels during 2011. as a response to this and to signs of increased inflation, emerging economies are gradually withdrawing their fiscal and monetary stimulus packages. differences in the growth outlook, risk perceptions and interest rates have created conditions that favor capital flows towards these economies ( figure 3 ). commodity prices remain high by historic standards, consistently with the strength of emerging economies, some specific supply - side elements and the depreciation of the dollar. worth noting are the recent sharp increases in the international prices of some foodstuffs and the copper price peaking at us $ 4. 2 per pound ( figure 4 ). the baseline scenario in the ipom we are presenting today assumes that some of these factors will persist over the projection scenario. in the case of copper, even if it will not be as high as today, it will exceed september ’ s projections,

the plebiscite does not put an end to the debate on chile's institutional framework. various political sectors have stressed the need to give continuity to this process, with the purpose of constructing a text that is in tune with the will of the great majorities. from the economic point of view, our past experience teaches us that all these processes entail a high degree of uncertainty which, if not mitigated, may adversely affect inflation, growth, and the stability of financial markets. for our part, we remain ready and available to continue collaborating in whatever the authorities may request of us, as we did in the process that has just ended, always within the limits imposed on us by the legal system and the autonomous and technical nature of our institution. the monetary policy report let me now turn to the contents and projections of our september monetary policy report. i must start by stressing that inflation is on a rising path. the latest available data, for the month of july, shows that its annual variation exceeded 13 %. in recent months, increases in food prices — volatile and non - volatile — continued to lead, accounting for almost one third of annual inflation in july. core inflation — measured by the non - volatile cpi — rose to 10 % year - on - year, with a higher contribution from services and non - volatile foods ( figure 1 ). the rise in total inflation again exceeded our expectations. the same as in june, the surprise was concentrated in volatile prices and non - volatile foods. the cpi is rising in a context of increasing inflation expectations. different sources of information have it that short - term inflation expectations have risen significantly. in the twoyear horizon, surveys to both experts and businesses continue to forecast that inflation will be above 3 % annually at that point, with figures that have also risen in recent months ( figure 2 ). this has also led to more frequent price changes by firms in response to rising demand and costs over the last two years. regarding activity, data for the second quarter and the beginning of the third suggest that the economy continued its adjustment process after the strong imbalances it accumulated in 2021. in the second quarter activity ( excluding mining ) fell by 0. 5 % quarter - on - quarter in its seasonally - adjusted series. this decline extended to july, where this component of activity fell 1. 1 % with respect to the previous month, also discounting seasonality. by sectors, the decline in trade stood out, and was partially offset