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Central Banks’ Communication Strategies: Just Words?

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Contemporary Issues in Banking

Abstract

This chapter assesses the communication strategies of the Federal Reserve (FED) and the European Central Bank (ECB), as well as their respective effectiveness. We explore the multi-dimensional aspects of the information embedded in more than 800 statements released by the heads of the EU and US central banks. Using tools from computational linguistics, we analyse the information released by these central banks on the state of economic conditions, as well as the guidance they provide about future monetary policy decisions. First, this chapter looks at some dimensions of the communication (tone, growth, ambiguity). Subsequently, we pay attention to the scenario’s impact on the communication strategies of the ECB and FED, assessing whether these strategies are influenced by certain variables that depict the scenario of the financial and real economy. Our results confirm the title of this chapter: most of the time, there is no significant difference between the communication strategy of the FED or the ECB, whether or not there is an improvement in the economic variables under consideration. We found that changes in communication strategy are mainly linked to changes in the health of the financial system.

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Notes

  1. 1.

    http://www.ecb.int/ecb/orga/transparency/html/index.en.html (last accessed on 29 June 2017).

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Author information

Authors and Affiliations

  1. Department of Management and Law, University of Rome Tor Vergata, Rome, Italy

    Vincenzo Farina

  2. Department of Economics and Business, University of Tuscia, Viterbo, Italy

    Giuseppe Galloppo

  3. Ceis Foundation, University of Rome Tor Vergata, Rome, Italy

    Giuseppe Galloppo

  4. Department of Business Studies, University Roma Tre, Rome, Italy

    Daniele A. Previati

Authors
  1. Vincenzo Farina
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  2. Giuseppe Galloppo
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  3. Daniele A. Previati
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Corresponding author

Correspondence to Daniele A. Previati .

Editor information

Editors and Affiliations

  1. Facultad de Económicas, University of Cantabria, Santander, Spain

    Myriam García-Olalla

  2. Facultad de Económicas, University of Cantabria, Santander, Spain

    Judith Clifton

Appendix

Appendix

Table 5.7 Relevant literature
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Farina, V., Galloppo, G., Previati, D.A. (2018). Central Banks’ Communication Strategies: Just Words?. In: García-Olalla, M., Clifton, J. (eds) Contemporary Issues in Banking. Palgrave Macmillan Studies in Banking and Financial Institutions. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-90294-4_5

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  • DOI: https://doi.org/10.1007/978-3-319-90294-4_5

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  • Publisher Name: Palgrave Macmillan, Cham

  • Print ISBN: 978-3-319-90293-7

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