They relate to potential conflicts of interest, reputational risks and central bank independence. 9  In the US, 469 banks were closed by the FDIC between September 2007 and December 2012. 10  There are also advantages for banking supervision if it is combined with monetary policy within one institution.
Of course, if the policies and communications regarding the future path of the policy rate were transparent and fully credible, such signaling would not be necessary. Moreover, if signaling is the primary channel through which large-scale asset purchases act, there remains much that we don’t understand about how to calibrate such operations.