Ladies & Gentlemen, Central Bank communication is important for financial market participants as it forms the basis for their extrapolations regarding current and future policy actions that might impact the value of their financial assets. So far, communication between the Central Bank and financial markets has worked fairly well. Market participants have learnt over time to distinguish between information and “noise”.
The Central Bank, on its part, has remained committed to provide markets with information while avoiding the “noise”. It has become increasingly clear to us that managing public expectations through effective communication is a central part of monetary policy and indeed, of central banking. This is an important aspect of formulating and communicating policy.