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Communication with Market Participants Is Important for Economic Policy Design – 11th International Conference on Central Bank Business Surveys

Communication with Market Participants Is Important for Economic Policy Design – 11th International Conference on Central Bank Business Surveys

The 11th Annual International Conference on Central Bank Business Surveys (CBBS), held on 16–17 September in Kyiv, convened central bankers from 21 countries and the ECB so that they would exchange experience in conducting business surveys, present their outcomes, and discuss further plans. The guest speaker was Dr Yuri Gorodnichenko, Professor at the University of California, Berkeley.

This was the first time this event had been held in a hybrid format. It showed that professional offline and online communications in times of COVID-19 can be productive.

"Over the past two years, our operating principles have changed, as has information, which is now more heterogeneous. We need new, more technologically advanced data collection tools and new customer products that would allow central banks to continue to pursue their important mandate of collecting and analyzing customer sentiment data to make important decisions in times of restrictions and uncertainty. I’m sure that every participant has unique experience conducting surveys in extraordinary conditions, and that this will contribute to our cause and allow the surveys to evolve, increasing their quality, performance, and use," said Yuriy Polovniov, Director of the NBU Statistics and Reporting Department. 

In the two days that the conference lasted, almost 30 participants presented the findings of their applied research, discussed topical issues of survey methodology, exchanged experience in using innovative tools, and answered professional questions from colleagues.

As expected, the discussions focused on the impact of COVID-19 on businesses, the labor market, migration trends, consumer sentiment, and more. The pandemic has reshaped economic policy-making, leaving the global economy and central banks in an unprecedented situation that requires a change of approach to information gathering and analysis, among other things.

Participants from the NBU made presentations about the impact of the media on the formation of respondents’ expectations, as well as the use of mobile application in online surveys as an additional tool to optimize data collection, increase the number of respondents, and facilitate their access to important information.

Other interesting topics included:

  • tools for measuring inflation expectations and perceptions of inflation targets
  • estimating the economic impact of uncertainty using a sectoral model
  • the role of different sources of information in business and household surveys.

The conference participants paid special attention to the importance of understanding the nature of inflation expectations and estimating them accurately in order to anchor them to the inflation target. Anchoring remains a key task for central banks that target inflation.

Participants in the panel discussion "The Importance of Central Bank Business Surveys: The Impact of Central Bank Openness on the Quality of these Expectations" concluded that surveys help:

  • better understand the reasons for respondents’ behavior, and more accurately measure their sentiment and expectations
  • monitor changes in business habits, plans, and ways to implement them
  • develop, based on data analysis, effective economic policy tools to overcome the crisis and ensure recovery and sustainable development
  • ascertain in time how economic agents respond to their own decisions and actions.

In his final speech, NBU Deputy Governor Sergiy Nikolaychuk thanked the organizers and participants for an interesting and constructive debate. The conference is part of reinforcing market participants’ confidence in central banks, he emphasized. Polls of economic agents conducted during the crisis have reaffirmed the success of the NBU’s emergency monetary instruments. In designing their economic policy and decision-making, central banks have been paying increasingly more attention to communications with the market, including through surveys. The new ideas highlighted by the conference will promote the further development of these important tools for collecting and analyzing information.

The 12th international conference will take place in Banff (Alberta) in 2022, the Bank of Canada announced as the conference drew to a close.

For reference:

Representatives of the Central Bank of Argentina, the Reserve Bank of Australia, the National Bank of Belgium, the European Central Bank, the Bank of Zambia, the Reserve Bank of India, the Central Bank of Iceland, the Bank of Italy, the Bank of Canada, Bank Negara Malaysia, the Bank Al-Maghrib, Norges Bank, Narodowy Bank Polski, the Central Bank of the Republic of Turkey, the National Bank of Ukraine, the Federal Reserve Bank of Atlanta, the Federal Reserve Bank of Cleveland, the Federal Reserve Bank of Richmond, the Federal Reserve Bank of St. Louis, the Federal Reserve Bank of Philadelphia, the Federal Reserve Bank of Chicago, the Banque de France, the Bank of Finland, the Central Bank of Chile, Sveriges Riksbank, the Swiss National Bank, the Central Bank of Sri Lanka, and the Bank of Japan participated in the two-day program of the conference.

 

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