Daily Archives: April 28, 2011

Central bankers like to think of themselves as brothers, doing roughly the same things, with roughly the same tools and communicating in roughly the same way. This is roughly true.

But there are important differences.

On monetary policy, the ECB is clearly an outlier. And the communication techniques of the Federal Reserve and the Bank of England are also interesting.

Robin has written about what we learned from Fed’s first first press conference yesterday, which is online in video form. I will give a few thoughts on how the Fed’s innovation compares with the Bank’s quarterly inflation report press conferences, which I have been attending since 1998.

Dumb traditions. Both banks have their peculiar silly traditions which undermine the credibility of the Fed chairman and BoE governor. Read more

Robin Harding

Ben Bernanke’s first press conference went pretty smoothly: I doubt there was a single question that the Fed will not have anticipated. It was also informative. I came away having learned or confirmed several new things about Fed policy.

The Fed’s forecast is that Q1 growth was below 2 per cent

“We haven’t seen the GDP number yet, but we, like most private-sector forecasters, are expecting a relatively weak number for the first quarter: maybe something a little under 2 percent.

Most of the factors that account for the slower growth in the first quarter appear to us to be transitory. They include things like, for example, lower defense spending than was anticipated, which will presumably be made up in a later quarter, weaker exports — and given the growth in the global economy, we expect to see that pick up again — and other factors like weather and so on.”

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