How should central banks communicate?

This European Central Bank Working Paper published on 25 November shows that central bank communication is a key determinant of the market's ability to anticipate monetary policy decisions and the future path of interest rates.

Comparing communication policies by the Federal Reserve, the Bank of England and the ECB since 1999, the authors find that communicating the diversity of views among committee members about monetary policy lowers the market's ability to anticipate policy decisions as well

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