Central banks take on social media.
The profile of and public interest in central banks have grown significantly over the past few years. They have been described as ‘the only game in town’ and ‘masters of the universe’. Their toolkits have grown to enable them to respond more effectively to financial crises. But increased public attention brings more scrutiny, and calls for greater legitimacy and accountability. Some pundits have suggested curtailing (or even ending altogether) central bank independence.
Trust is central bankers’ most valuable resource. In today’s environment, safeguarding and building trust has become one of the most pressing issues facing central banks. Their communications practices offer one avenue for doing so. This includes use of innovative instruments. As a result, central banks are increasingly using social media to reach the public directly. In December 2018, a study by the Pew Research Centre showed that social media sites for the first time surpassed newspapers as sources of news for people in the US – one-in-five adults consume news on social media, compared with 16% for newspapers.