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Communication, transparency, monetary policy index, central bank watching

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  • da Costa Filho, Adonias Evaristo
  • Rocha, Fabiana

Abstract

The purpose of this paper is to discuss the role of communication and transparency in the conduct of monetary policy by the Brazilian Central Bank. Initially we build a glossary that translates the qualitative information contained in the minutes of COPOM into an ordered scale index, similar to the one built by Rosa and Verga (2005). We find evidence of a consistent behavior by COPOM, in the sense that its words are followed by actions in the same direction. Based on estimates of Taylor rules, we also find evidence that the index help to understand interest setting , justifying the central bank watching behavior.

Suggested Citation

  • da Costa Filho, Adonias Evaristo & Rocha, Fabiana, 2009. "Communication, transparency, monetary policy index, central bank watching," Revista Brasileira de Economia - RBE, EPGE Brazilian School of Economics and Finance - FGV EPGE (Brazil), vol. 63(4), December.
    • Handle: RePEc:fgv:epgrbe:v:63:y:2009:i:4:a:1314
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