Assessment of the Clarity of Bank of Russia Monetary Policy Communication by Neural Network Approach

The article examines the degree of public trust in the Central Bank of Russia after the transition to inflation targeting. For this purpose, the author analyzes available data from inFOM consumer surveys of confidence in the Bank of Russia as a whole as well as in its inflation targets from 2014 to 2024. Public confidence in the Bank of Russia remained relatively high from 2014 to 2017 as inflation targeting was adopted, but the Bank became far less credible to households from 2019 to 2022 because they did not believe the inflation target of 4% was achievable by the end of the current year or over the medium term. This is probably due to their lack of awareness that the Bank’s principal goal is price stability even though they are actually experiencing high inflation. The households surveyed think that government authorities are largely responsible for controlling inflation. Furthermore, consumers do not take notice of the information provided by the Central Bank of Russia. Using news articles from Russian media, posts from news communities on the VKontakte social network, and Google Trends search queries, the author shows that consumers who ignore information about the Bank’s policy are at a serious disadvantage when there is economic uncertainty. The discrepancy between the inflation expectations of consumers and professional forecasters diminishes as the volume of information tied to the phrase “Bank of Russia” increases in media, social network posts, and online searches.

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Digital communication of the Bank of Russia in social media

Shcheglov,

Pashkus

2024

Теоретическая И Прикладная Экономика

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The subject of this study is digital communication of the Bank of Russia in social media. The relevance of the article is determined by the role and significance of modern digital communication channels in everyday life and the potential for their use in ongoing monetary policy. The authors systematize and summarize scientific articles devoted to the connection between effective communication and monetary policy pursued by central banks. The article notes that successful central bank communication should make monetary policy more predictable and market expectations about future rates more accurate. The purpose of the current article is to assess the readability of digital materials published by the Bank of Russia on official social networks and instant messengers. To assess the readability of digital publications, the authors identify two large audience groups: professional and non-professional. As a text analysis method, the authors rely on syntactic and lexical methods and use the Flesch-Kincaid index and Fog-Index as indicators of text readability. The authors presented the key channels and communication tools of central banks, and also highlighted the main channels of digital communication of the Bank of Russia: the Bank of Russia website, social media and the Bank of Russia application “Central Bank Online”. Each of the channels has both direct and indirect affiliation. The results of the direct affiliation channel of social media and the website emphasize the positive dynamics of readability indices – materials published on social networks by the Bank of Russia become clearer to a wider audience segment. However, most publications still require specialized training in economics and finance to fully understand the information. Thus, in communication on social networks, the Bank of Russia’s focus is on reaching a non-professional audience in order to increase transparency and the level of trust in its monetary policy.

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Assessment of the Clarity of Bank of Russia Monetary Policy Communication by Neural Network Approach

Cited by 3 publications

References 50 publications

Using GPT-3 as a Text Data Augmentator for a Complex Text Detector

Using GPT-3 as a Text Data Augmentator for a Complex Text Detector

How Credible Is the Central Bank of Russia to Russian Households?

Digital communication of the Bank of Russia in social media

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