Central banks should not give impression of ‘complete foresight’

Jill-Vardy
Jill Vardy at the Central Banking Awards 2017
Janie Airey

Central bank cannot provide “complete foresight” when communicating policy, but should endeavour to give a “comprehensive assessment” of relevant factors, officials at the Bank of Canada have said.

Sharon Kozicki and Jill Vardy, both advisers to the governor, say communications that help markets understand the central bank’s objectives and tools can boost the transmission of policy.

“To help markets and others understand its reaction function and play their role in the transmission mechanism

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