When tone trumps central banks’ strategies

In an analysis of more than 800 speeches presented by the presidents of the European Central Bank and the Bundesbank, differences in communication strategies and divergence of tone on monetary policy are considered with their implications for shocks and interest rate responses.

Prof Tillmann has undertaken extensive research on how changing communication methods, such as Twitter, have been impacting on financial markets globally in unprecedented ways.

In his seminar presentation he will examine closely ongoing conflict between the presidents of the ECB and Bundesbank who largely control monetary policy in the euro area, and how differences in their communication approach can influence the expectation component of long-term interest rates.

Prof Tillmann has observed that ECB communication about monetary policy is persistently more positive than the Bundesbank, but when there is cacophonous communication from the two bodies there can be muted adjustments from financial markets in some circumstances.

His seminar will be held on Wednesday 25 September from 10.30am – 12pm, with morning tea included, in room 623 of 4 Eastern Road.