The more the public pays attention to what the Central Bank is doing, the harder it becomes for the bank to control inflation.
April 1, 2026
Original Paper
Attention to Monetary Policy
SSRN · 6398378
The Takeaway
We usually assume transparency and public engagement help stabilize the economy, but high search intensity actually causes public expectations to diverge from the bank's goals. This creates a paradox where intense public focus actively weakens the primary tools used by central banks to anchor prices.
From the abstract
We develop a Google Trends-based Monetary Policy Attention (MPA) index to measure the intensity of public focus on monetary policy. While conducting a series of validation analyses, we find that the MPA index specifically captures search intensity related to monetary policy rather than general economic noise; the index rises significantly with inflation and monetary policy-related uncertainty, while remaining unresponsive to broader economic policy uncertainty. Using a state-dependent local proj