Words are tools. As much as Lombard rates are.
Lombard rates are central banking tools. Central banks such as the Czech National Bank lend short-term funds to commercial banks at these rates. The term 'Lombard' refers to the pioneer medieval bankers from the Italian Lombard region.
As the experience of a number of pioneer inflation-targeting central banks has shown over the past two or so decades, words too are central banking tools. Pronouncing a word can be more powerful than manipulating rates or using other instruments.
Central banks use words to say what they do and how.
Central banking stories you read on this site are hand-picked and written exclusively by Marek Petruš. That's me. I closely follow how central bankers use words when speaking in public. My stories reflect my observations on the statements central banks release and on the news media publish about them.
Whenever I stumble upon an important, inspiring, interesting - or even outright entertaining - piece of news concerning reputation, transparency and communication of central banks, I make a post here. Besides that, I sometimes highlight the consulting stuff I do for central banks to pay for my shoes.
I know central banks inside out. Literally.
I have been paying a close attention to central banks for almost two decades. And I know central banks and their communication and decision-making practices inside out.
I had covered a number of central banks from the outside during my years as a correspondent for Dow Jones Newswires/Wall Street Journal and Reuters. Most of my focus since late 1990s has been on the Czech National Bank.
I intimately know the central banking business from the inside. Every week on Thursday for more than six years, I sat at the board room table alongside Czech monetary policy makers.