The timing of central bank communication

Michael Ehrmann () and Marcel Fratzscher ()

No 565, Working Paper Series from European Central Bank

Abstract: This paper explores whether there are systematic patterns as to when members of the decision-making committees of the Federal Reserve, the Bank of England and the European Central Bank communicate with the public, and under what circumstances such communication has the ability to move financial markets. The findings suggest that communication is generally seen as a tool to prepare markets for upcoming decisions, as it becomes more intense before committee meetings, and particularly so prior to interest rate changes. At the same time, markets react more strongly to communication prior to policy changes. Other instances where communication becomes more intense, or where financial markets become more responsive are also identified; even though these are more specific to the individual central banks, they are consistent with differences in the central banks’ monetary policy strategies and communication policies.

Keywords: Communication; central bank; monetary policy; timing. (search for similar items in EconPapers)
JEL-codes: E43 E52 E58 G12 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cba, nep-eec, nep-fin, nep-fmk, nep-mac and nep-mon
Date: 2005-12
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Related works:
Journal Article: The timing of central bank communication (2007)
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Persistent link: http://EconPapers.repec.org/RePEc:ecb:ecbwps:20050565

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