Actually, in the last year, local uncertainty indicators have consistently outweighed those of economies such as the United States or the United Kingdom, as the decline to their pre-pandemic levels has taken longer. This trajectory clearly differs from what used to be the case before the social outbreak, when the level of uncertainty was not only much lower, but also more in line with other countries (Figure 7). The Chilean financial market has reacted to the overall local developments by decoupling itself from global trends. Thus, long-term interest rates have increased by 30 basis points since mid-April to date (BCP10), while their external benchmarks have not changed much. This has been accompanied by a stock market drop of just over 10 percent, a 2 percent depreciation of the Peso and an increase in the sovereign premium (CDS) of 15 basis points, all despite the significant rise in the copper price. This has coincided with a period of heightened political tensions surrounding the third pension savings withdrawal and a wide range of legislative initiatives on fiscal and regulatory matters (Figure 8). On the external front, world growth has been consolidating the positive outlook for this year and next, which has been internalized by the global financial markets. The evolution of the external scenario is closely linked to the progress of vaccinations and business reopening in developed countries, which has resulted in a rebound and strengthening of consumer and business confidence and activity in the lagging sectors (Figure 9).
In fact, the female participation rate is still far from its pre-pandemic levels, affected by the extra responsibilities on home care that many women have had to assume. This issue is examined in one of the boxes of this Report, and I will refer to it in more detail in a while (Figure 5). Since the previous Report, benefits for households and small businesses have been expanded and will be significantly increased with the measures recently approved by Congress within the framework of the “Common Minimums Agenda”. In the second half of April, the Government announced the strengthening of the middleclass bonus and the Emergency Family Income, together with a complementary bonus for those with empty pension fund accounts. Congress also approved a third withdrawal of pension savings, which includes an advance of benefits for pensioners with annuities. In the context of the Common Minimums Agenda, a substantial extension and expansion of transfers has just been approved, including an Emergency Family Income, which will be extended in amount and coverage, and will reach more than 15 million people over the next four months. In addition, the provision of subsidies and tax benefits for micro and small businesses is being discussed. These initiatives combined will push fiscal spending growth to around 25 percent in nominal terms in 2021, which compares to the 5 percent considered in the March Report.