This paper aims at assessing whether, and how, communication of central bank’s forecast might affect economic dynamics. In a simple new Keynesian environment it is assumed that private sector conditions its own expectations to central bank’s forecasts. Private sector’s prior expectations...

type="main" xml:lang="en" <title type="main">Abstract</title> <p>This paper aims at assessing the relevance of communicating central bank's forecasts to the private sector under discretionary monetary policy. In a New Keynesian environment, the central bank and the private sector have different information sets. The private...</p>