However, various factors may result in a sharper or longer-lasting drop, which could affect price formation over longer terms and inflation expectations. In this context, the Board estimates that the risk balance is unbiased for activity, and for inflation it is biased downward in the short term, but unbiased in the medium term. As a working assumption, our baseline scenario estimates a similar monetary impulse as in June, i.e., the MPR remaining fairly stable and beginning to move up towards neutral only after the economy starts closing the activity gap. Thus, monetary policy will remain expansionary through the entire projection horizon. As always, we will be watchful for any deviations from the baseline scenario that warrant moving the MPR. As I just said, in the short run inflationary risks are biased downwards. If it happens, it may affect convergence to the target, in which case monetary policy will need to be even more expansionary. New institutional developments and contributions Dear senators, I am submitting to you this, my first annual account as Governor of the Central Bank. I head an institution that has more than a quarter of a century of autonomous history and that, over this time, has built and consolidated a technical reputation that has allowed for the correct performance of its functions, transforming it into an institutional reference in the public apparatus and in the group of central banks of emerging countries. This has occurred to a large extent thanks to our important contribution to the country's macroeconomic stability.
The terms of trade have improved, with copper prices above $ per pound in recent weeks. This, in a context in which the price of oil, with fluctuations and considering the Brent - WTI average, is slightly below those at the cutoff date of the previous Report. The copper price rise has coincided with a well-stocked market despite supply-side problems, in the context of a weak dollar. China's low interest rates and better performance lend support to higher prices in the short term. In any case, although its price is not expected to remain stable, it is projected to average more than June's estimates. In our baseline scenario, the pound of copper should trade at an average of $ in 20172018, and at $ in 2019. Stronger economic growth in the developed world has also consolidated. The United States, like it did several quarters ago, shows a good performance of consumption and a dynamic labor market. Europe has seen a strong recovery in its growth rates, all across the economies making up the group, beyond the differences that persist among them in variables such as the size of the gap and the unemployment rate. Growth in Japan surprised positively, and expectations have been revised upwards. Meanwhile, inflation has tended to subside and the monetary authorities of the developed world have made no big changes to their monetary policy strategies.