The tariffs announced by the United States in early April —and subsequent developments— have considerably heightened uncertainty around the world. The unexpected magnitude of the announcements caused significant movements in financial asset prices and a substantial increase in volatility. Global financial markets have operated without major disruptions; however, risks to financial stability have increased markedly. At home, financial assets have also shown greater volatility, with trends that mirror those of other emerging economies. The Chilean economy has fixed the imbalances of previous years and the financial situation of borrowers —households and firms— has improved with respect to the previous report. Banks, in turn, have liquidity and capital levels that would allow them to withstand negative events. Thus, the deterioration of the global scenario finds the Chilean economy on a better position. A worsening of geopolitical and trade tensions represents the main risk for local financial stability, due to its impact on economic growth and deteriorating global financing conditions. Although the Chilean economy is not immune to these challenges, it has macroeconomic soundness and robust financial regulation and supervision standards in place, which provide adjustment mechanisms and buffers to mitigate the effects of adverse shocks.