southern cone and andean opportunities conference chile : the view from the central bank mario marcel1 / governor, central bank of chile april 2017 current macroeconomic conditions and prospects in the monetary policy scenario 1. the last few months have brought mixed signals for the chilean economy. on the one hand, 2016 ended in a low tone, with a slowdown in activity and inflation. a series of oneoff events extended economic weakness into the first quarter of 2017, lowering forecasts for the year as a whole. on the other, the global outlook appears more favorable, both for the growth of trade partners and terms of trade. this suggests a gradual improvement of economic prospects for the chilean economy which should be further supported by an expansionary monetary policy as long as inflation remains below target. 2. activity data and expectations in advanced economies have been more upbeat, marked by better than expected performance by the manufacturing sector and a broadening of the growth outlook across countries following years of stagnation. as a result, deflationary risks have dissipated, as inflation is expected to return to more normal levels. the federal reserve ( fed ) has continued to normalize monetary policy and monetary authorities in europe and japan appear to have set aside the possibility of additional stimulus measures. markets have incorporated these changes in their expectations avoiding any serious disruptions. along with better signs in advanced economies, activity in china has remained relatively stable, which contrasts with what had been observed one year ago. 3. in this context, there has been an increase in the willingness to take on risk in financial markets, increasing stock market indices, reducing sovereign risk premiums and increasing capital flows to emerging markets. commodity prices have also benefitted. copper, our main export product, has been trading at prices near two year highs and prospects for the next few years have improved, which has had a material impact on the chilean terms of trade. thus, based on better growth prospects for our trading partners, favorable external financial conditions and increased terms of trade, the baseline scenario included in the monetary policy report published at the beginning of april, considered that, for the next two years, the chilean economy will receive an external impulse higher than considered at the end of 2016 ( figure 1 ). 1 / keynote speech at the vi jp morgan southern cone and andean opportunities conference, april 25th, 2017. this speech is based upon that delivered at the council of the americas, april 20th, 2017. figure 1 trading partners gdp terms of trade ( * ) ( annual change,

bruno gehrig : review of the swiss economy introductory remarks by prof bruno gehrig, vice - chairman of the governing board of the swiss national bank, at the half - yearly media news conference, geneva, 14 june 2002. * * * developments in the financial markets from a swiss vantage point, the situation on the financial markets in the first half of 2002 was predominantly influenced by the exchange rate development of the swiss franc. the appreciation against the euro, which set in after 11 september 2001, has been arrested but has failed to bring about a sustained correction of the exchange rate. moreover, the us dollar, too, has declined since april. at the beginning of june, it had fallen to its lowest level against the swiss franc in two - and - a - half years. there are several reasons for the decline of the us dollar – by approximately 7 % against the euro and the swiss franc since the end of march, by approximately 6 % vis - a - vis the yen – : imponderables of global political significance, growing doubts concerning a sustained upswing in the united states and – exacerbated by the collapse of enron – the scepticism of investors with respect to the future development of yields. the record us current account deficit is increasingly being financed by means of short - term capital flows from abroad, which, by their very nature, are volatile. against this background, high - risk investments generally showed a weaker trend. equity markets and the us dollar lost in value while the gold price, bonds and the swiss franc moved up. as may repeatedly be observed in uncertain times, higher demand for swiss francs resulted from the greater attraction exerted by our currency on foreign and particularly also on domestic investors. one of the reasons for this is the extremely high international net creditor position of our country ( 139 % of gdp ). in times of instability, swiss investors reduce the risks by investing a larger part of their holdings ( or the yields thereon ) in the home currency or by hedging their foreign - currency balances to a greater extent than previously. both strategies strengthen the demand for swiss francs. with interest rate differentials between swiss franc and foreign currency investments having widened since spring, the « price » to be paid by investors for the « safe haven » offered by the swiss franc has, however, risen. the yield differential between long - term investments in euros and those in swiss francs again amounts to almost two percentage points