In September 2013, the MPC said that a minimum necessary condition for a rise in interest rates was that unemployment should fall below 7%. This was not a sufficient condition and the Committee was also at pains to emphasise that the actual path of rates would depend on the outlook for the economy at the time. Yet quite a few observers viewed the condition as a hard trigger and were confused when rates didn’t immediately and automatically rise in response (memorably, one MP subsequently likened the Committee to “an unreliable boyfriend, blowing hot and cold”). Similarly, in a speech in July 2015[5], the then-Governor Mark Carney said the “the decision as to when to [start raising interest rates] will likely come into sharper relief around the turn of the year”. This was no more than suggestive and was immediately qualified with a remark about the importance of economic developments in the interim: “I am conscious of several important considerations which mean the actual path [of interest rates] almost certainly will not be mechanical, linear or pre-determined.
So, it raises the “signal-to-noise” ratio, which reduces uncertainty faced by private agents and strengthens the pass-through from communication to market expectations. Second, transparency is a mechanism for democratic accountability, in a world of policy discretion and central bank independence. Transparency makes it easier to judge whether a central bank is committed to its announced policy, and acts as a check on possible temptations to base policy on short-run or political considerations. In short, communication demystifies and democratises monetary policy. The empirical literature finds that better information about central bank actions can lead markets to do the central bank’s work for it. Blinder et al. (2001) was an early study which found that the US bond market’s ability to forecast Fed actions improved from around 1996 onwards, a few years after the Fed started announcing policy changes and publishing minutes of its meetings. Relatively small changes in the Fed’s policy rate were amplified by complementary movements in the bond market, which helps to stabilise the 1/5  BIS central bankers' speeches  macroeconomy.