These critics claim that European monetary policy is not sufficiently transparent, and therefore sends out misleading signals, especially regarding the future course of key interest rates. This assertion is particularly surprising given that many studies have shown time and again that the predictability of the single European monetary policy is, in fact, very high – not low, as some critics claim.
This applies to both the short-term horizon – decisions on key interest rates have been highly foreseeable over short time horizons, and to the long-term horizon – the monetary policy framework, comprising monetary policy’s ultimate goal and its strategy, is well understood by most market participants.