Importance of Language in Central Banks’ Management of Financial Markets: Creating Trends and New Vocabulary
Importance of Language in Central Banks’ Management of Financial Markets: Creating Trends and New Vocabulary

Author(s): Borislav Marušić, Branimir Kurmaić
Subject(s): Social Sciences, Economy
Published by: Udruženje ekonomista i menadžera Balkana
Summary/Abstract: Language is often considered a living organism that changes with the times. It is a fact that the glossary of business English has grown in interesting ways in the age of day trading. The ever-growing importance of semantics in fnancial statements or, perhaps even more importantly, central bank statements seems to have coincided with the rise of the internet as the dominant way of information in the fnancial industry. Specially programmed algorithms scan Reddit boards in search of new trends, information is absorbed constantly, and trades are realized in seconds. In such an environment, ofcials’ statements have become more obtuse, the language more nuanced, and meanings blurred. The authors analyze the way central banks speak to the markets, how that impacts trends in the trading of fnancial securities, and provide an overview of some of the vocabulary impacted directly or indirectly by their actions that are now widely used by the fnancial media, institutions and day traders.

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