Central bank communication is important in order to manage market expectations, which matter for the economy. Central banks engage with the public via a wide range of methods such as formal statements after policy meetings, press conferences and regular speeches by members of policy-making boards.
Over the past few years, central bank communication has increased to reach broader audiences. As a result, the profile of and public interest in these institutions has grown significantly. With this increased public attention comes a call for even greater transparency and accountability.
Despite the increase in communication, evidence suggests that many people never engage with it because it is written in a way that they can’t understand. This contributes to a lack of trust in the central bank. Because of this twin deficit, central banks have started to look more specifically at the ways in which they communicate with broader audiences.
In 2018, the Bank of England produced a research report with the UK’s Behavioural Insight Team titled, ‘Enhancing central bank communications using simple and relatable information’. The report looked into how usual modes of communication can be adapted to increase the broader public’s understanding of central banks’ policies.
David Bholat, senior manager, advanced analytics and co-author of the Bank’s report, and Chris Peacock, head of content creation at the Bank of England, join OMFIF’s Helen Gibson to discuss the report and its findings, before looking at how the BoE is using more simplified language to educate the public and increase their engagement with, and understanding of the Bank’s policies.
Further reading:
GPI 2019 special report: Central Bank Communications
Lagarde’s communications challenge