Last but not least, our free floating exchange rate system has permitted the exchange rate to depreciate nearly 11 percent in real terms with respect to its trough of 2013, helping adjust the current account and favoring the competitiveness of our export sector. The saying goes that what is obvious is not talked about, and what is not talked about is forgotten. So I have thought relevant, especially in this environment that at times becomes overwhelmingly pessimistic, to stress how well equipped our economy is to deal with adverse situations. I think that the comparison with other economies of the continent, which have also suffered the brunt of the fall in the prices of our commodities, is revealing: most of them have high current account deficits and several show fiscal situations that are worrying to say the least. In many of them, high levels of dollarization or currency mismatches in the financial sector, restrict the room for exchange rate adjustment and force authorities to use less efficient instruments to achieve their goals. Chile’s reality is different: our economy’s adjustment occurred sooner than in other countries and it did so rapidly and deeply. This situation allows us to look into this and the coming years with some peace of mind. In this context, and as we projected in December, output growth has tended to stabilize around 2.5 percent annually, which is low, but in line with our baseline scenario should increase gradually through the year.
Rodrigo Vergara: Chile’s March 2015 Monetary Policy Report Presentation by Mr Rodrigo Vergara, Governor of the Central Bank of Chile, of the Monetary Policy Report before the Finance Committee of the Honorable Senate of the Republic, Santiago de Chile, 30 March 2015. *  *  *  The Monetary Policy Report of March 2015 can be found at http://www.bcentral.cl. Accompanying charts can be found on the Central Bank of Chile’ website. Introduction Mr. President of the Finance Committee of the Senate, senator Andrés Zaldívar, senators members of this Committee, ladies, gentlemen, I am grateful for your invitation to present the vision of the Board of the Central Bank of Chile about the recent macroeconomic developments, their prospects and implications for monetary policy. This vision is detailed in our Monetary Policy Report (IPoM) of March 2015. But first and foremost, a few words of solidarity towards my fellow citizens that have recently suffered Nature’s wrath. The images and stories we have been receiving of the catastrophe that has swept across our country’s north are devastating and fill us with concern. In the past few months, inflation has exceeded December’s forecasts, and it is stubbornly above 4 percent. This Report’s baseline scenario also estimates a slower return to the target range than foreseen at the end of 2014. The depreciation of the peso continues to be the main factor behind the price dynamics, which, coupled with widespread indexation and a tighter than expected labor market, has pushed the core measure, i.e.