To the extent that it can explain its general approach, clarify its plans and objectives, and provide its assessment of the likely evolution of the economy, the central bank should be able to reduce uncertainty, focus and stabilize private-sector expectations, and with intelligence, consistency, and persistence – develop public support for its approach to policymaking.
Why are accountability and transparency so important for monetary policy? The notion of transparency is broad ranging. It encompasses notions of accountability and political legitimacy of decision makers, as well as the legal and accounting infrastructure in which economic decisions are made.