Central bank transparency: cross-country comprehension (example of inflation reports)
Journal Title: Business Ethics and Leadership (BEL) - Year 2017, Vol 1, Issue 2
Abstract
Implementation of inflation targeting strategy by the central bank is connected with the public announcement of inflation targets and central bank’s obligation to achieve these goals. The main element of the central bank’s communication policy in terms of implementing the inflation targeting strategy is the inflation report. The study offers three methods of assessing the quality of inflation reports: 1) expert method (an evaluation of the inflation reports produced by 15 inflation-targeting central banks considering the following criteria: how convincing the report is judged to be, how users trust the central bank, how decisions on monetary policy are fully argued; how complete the report is and the overall assessment of the report); 2) readability test (Flash index calculation, “target audience” definition); 3) content analysis of inflation reports (by using ABBYY FineReader 9.0, ATLAS.ti 7, QDA Miner Lite software). We find that variables that characterize the quality of the inflation report are closely negatively related to the degree of change in the market participants expectations of interest rate. The statistical relationship between the quality of inflation reports and predictability of monetary policy was proved by using STATISTICA 10 package.
Authors and Affiliations
Abdul Rahman Barhaq, Alona Zakutniaia
Keywords
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- EP ID EP460694
- DOI 10.21272/bel.1(2).47-54.2017
- Views 115
- Downloads 0
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