(iii)  Central bank communication  In a market-determined system, central banks have placed a greater reliance on transparency and communication to enhance monetary policy transmission and establish accountability to the public for their decision-making. So far the experience shows that communication on monetary policy issues has moved from complete secrecy, to constructive ambiguity to transparency.
For instance, the Fed and the ECB have in recent years frequently provided fairly direct indications about future interest-rate decisions in their official statements. We, in the RBI, have also started giving forward guidance since September 2010. However, there are several challenges. It is not easy to communicate clearly on a single objective.