Discussion of Can Central bank Transparency Go Too Far?

The paper by Rick Mishkin is a clear and timely overview of the state of the debate on the transparency of central banks. The paper asks three supplementary and related questions on the way to answering the main question – ʻCan central bank transparency go too far? ̓The fi rst question is whether central banks should publish forecasts of a range of variables and not just forecasts of infl ation. In particular, the paper considers whether central banks should announce a forecast for real output and a ʻno change interest rate ̓or a future path for interest rates. The second question is whether central banks should announce their objective function, so that the private sector understands how they will react to a variety of possible future events. The third question is how central banks should talk about output given that most have both output and infl ation in their objective functions.