Clear, consistent and engaging: ECB monetary policy communication in a changing world

Katrin Assenmacher, Gabriel Glöckler, Sarah Holton, Peter Trautmann, Demosthenes Ioannou, Simon Mee, Conception Alonso, Eleni Argiri, Filippo Arigoni, Klára Bakk-Simon, Stephanie Bergbauer, Marie Therese Bitterlich, Jennifer Byron, Alexandre Carvalho, Marco Catenaro, Evangelos Charalampakis, Marjolein Deroose, Michael Ehrmann, Ricardo Fernandez, Clodomiro Ferreira Mayorga (), Giuseppe Ferrero, Marius Gardt, Dimitris Georgarakos, Pavel Gertler, Alessandro Giovannini, Olga Goldfayn-Frank, Robert Goodhead, Roel Grandia, Jenni Hellström, Nils Hernborg, Niko Herrala, Mathias Hoffmann, Patrick Huertgen, Michael Ioannidis, Klodiana Istrefi, Krista Kalnberzina, Danielle Kedan, Geoff Kenny, Georgi Kocharkov, Tobias Linzert, Marta Manrique, Víctor Márquez, Ricardo Mestre, Justus Meyer, Emanuel Mönch, Stefano Nardelli, Elisa Newby, Nele Nomm, Lora Pavlova, Adrian Penalver, Reet Reedik, Kilian Rieder, Corina Ruhe, Anna Samarina, Martin Šanta, Fabian Schupp, Guido Schultefrankenfeld, Geert Sciot, Maria Silgoner, Ifigeneia Skotida, Aliki Stylianou, Eva Taylor, Johannes Tischer, Andrea Tiseno, Michael Weber and Bernhard Winkler
Authors registered in the RePEc Author Service: Emanuel Moench and Evangelos Charalambakis

No 274, Occasional Paper Series from European Central Bank

Abstract: This paper examines the importance of central bank communication in ensuring the effectiveness of monetary policy and in underpinning the credibility, accountability and legitimacy of independent central banks. It documents how communication has become a monetary policy tool in itself; one example of this being forward guidance, given its impact on inflation expectations, economic behaviour and inflation. The paper explains why and how consistent, clear and effective communication to expert and non-expert audiences is essential in an environment of an ever-increasing need by central banks to reach these audiences. Central banks must also meet the demand for more understandable information about policies and tools, while at the same time overcoming the challenge posed by the wider public’s rational inattention. Since the European Central Bank was established, the communications landscape has changed dramatically and continues to evolve. This paper outlines how better communication, including greater engagement with the wider public, could help boost people’s understanding of and trust in the Eurosystem. JEL Classification: E43, E52, E58

Keywords: accountability; central bank; forward guidance; transparency; trust (search for similar items in EconPapers)
Date: 2021-09
New Economics Papers: this item is included in nep-cba, nep-isf, nep-mac and nep-mon
Note: 2721763
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:ecb:ecbops:2021274

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