RBA Should Reach More People Using Simplified and Innovative Communication

Communication has become the key that unlocks many doors. A lot of communication that happens on a larger scale, is deliberately designed to be vague to the layperson, who though may not be attuned to the overall happenings but are entitled to information that affects their daily life. Central Bank announcements are the most confounding, heavily jargonized and belong to alien vocabulary to most of the people they are directed towards, says a recent report in Australia.

The Reserve Bank of Australia (RBA), is one of the many who leave millions confused about their utterance and declarations, wanting to run for cover due to how important they sound and to an interpreter for how unintelligible it is. This utterly essential speech is usually built to cater to bankers and analysts. But a few countries are changing the game and seeking more public participation by speaking to people in their language. Jamaica should be given the top points for heralding this change. In fact, the central bank there completely remodeled communication to suit the cultural sensibility of its people by releasing a reggae to explain the benefits of the new monetary policy to its masses.

A similar approach was adopted by Russia, who too effectively communicated to its public via a video.

These financial institutions set the tone for the country’s economy and according to experts sometimes it is essential to have vague and ambiguous responses from them so the economy at play does not mirror their words. Dr. Eli Remolona, formerly of the Federal Reserve Bank of New York and the Bank for International Settlements, says most central bank communiqués are vague on purpose. “They’re planning to cut, but at the last moment they may decide, ‘No, we shouldn’t cut. Because what happens in a market is that if there’s a very clear signal, then everyone just focuses on that and it overreacts to that signal,”says Dr. Remolona.

Communication is becoming crucial. Central entities have understood the importance of having public involved and as more willing participants, so there have been attempts at simplifying policies and having transparent interaction with them. With the many portals of social media in tow, these federal bodies can pull in more crowd. The RBA’s social media accounts are also doing more than just posting media releases. Its 42,000 Twitter followers can see visual charts, bulletins and videos in their feed.