Central Banks’ Communication Strategies: Just Words?

Part of the Palgrave Macmillan Studies in Banking and Financial Institutions book series (SBFI)


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.


Central bank communication Glossary Communication effectiveness Communication strategies Scenario analysis Central bank communication 


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Copyright information

© The Author(s) 2018

Authors and Affiliations

  1. 1.Department of Management and LawUniversity of Rome Tor VergataRomeItaly
  2. 2.Department of Economics and BusinessUniversity of TusciaViterboItaly
  3. 3.Ceis FoundationUniversity of Rome Tor VergataRomeItaly
  4. 4.Department of Business StudiesUniversity Roma TreRomeItaly

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