Even the most brilliant new theory or discovery will be of no value if it cannot be communicated and understood by the target audience. Similarly, monetary policy loses its effectiveness if it is not understood and if the central bank does not have credibility.
The uncertainties, complexities and imbalances that exist in the global economy make appropriate communication strategies by central banks all the more important. Clear and regular communication about policy objectives, the policy outlook, risks and objectives becomes an increasingly important policy instrument, in addition to setting interest rates.