Endogenous Information and Central Bank Transparency

This paper studies monetary policy under discretion when the central bank ex ante determines information to be acquired and made public. In a general setting, wherein a monetary instrument signals the central bank's private information, I show that an optimal information policy comprises the full disclosure of acquired information, which eliminates the signaling role of the monetary policy. I find that an information policy combined with a discretionary monetary policy implements an optimal commitment policy. Using a simple monetary model, I characterize the optimal policy that publicizes multiple indices, inducing a correlation in public expectations regarding shocks to the economy