Writing Clearly: ECB’s Monetary Policy Communication

By Martin Cihak, Katerina Smídková, Ales Bulir

October 1, 2008

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Martin Cihak, Katerina Smídková, and Ales Bulir. Writing Clearly: ECB’s Monetary Policy Communication, (USA: International Monetary Fund, 2008) accessed November 21, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

The paper presents a methodology for measuring the clarity of central bank communication, illustrating it with the case of the European Central Bank (ECB) in 1999-2007. The analysis identifies the ECB's written communication as clear about 95 percent of instances, which is comparable to, or even better than, other central banks for which a similar analysis is available. We also find that the additional information contained in the ECB's Monthly Bulletins helps to improve communication clarity compared to ECB's press releases. In particular, the Bulletins contain useful clarifying information on individual inflation factors and the overall forecast risk; in contrast, the bulletin's communication on monetary shocks has a negative, albeit small, impact on clarity.

Subject: Central bank policy rate, Communications in revenue administration, Economic forecasting, Inflation, Inflation targeting

Keywords: Central bank, Monetary policy, WP

Publication Details

Pages:

34
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2008/252
Stock No:

WPIEA2008252
ISBN:

9781451871104
ISSN:

1018-5941

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