It is always a pleasure to be in Santiago and I am especially pleased to be able to join you at this annual conference which in its nine years has established a high reputation for the quality of the papers and the discussion. This year’s conference is focusing on the subject of inflation targeting. I want to set the scene for the two days of discussions by putting this in a broader context. My aim this morning is to assess the benefits to the world economy of a low inflation environment. I will start by reviewing the progress made in almost every country in recent years towards achieving low inflation. I will next analyze the gains that have accompanied this changing environment—notably more rapid global growth, greater stability, and reduced vulnerability. And finally I will say something about the role the IMF plays in helping to foster an environment of low inflation, especially as we seek to support the policy reform efforts of our members.