Monetary policy via Facebook is Southeast Asia tool in turmoil

As the economic landscape gets more rocky, Southeast Asia’s central bankers are turning to Facebook and YouTube for help in getting their messages across.
The Bank of Thailand was the latest to adopt a live video-streaming of its policy announcement in August, three months after the Philippine central bank did the same. Bank Indonesia, which has more Twitter followers than the Federal Reserve, recently stepped up broadcasts of its policy decisions to every month.
Central bankers are using social media to keep markets calm and to help explain their decision-making more directly to households that are feeling the pinch from currency turmoil and rising prices. Of the five main central banks in the region — Indonesia, Thailand, Singapore, the Philippines and Malaysia — only the Bank of Thailand hasn’t tightened policy yet this year.
“The messaging definitely has been more clear, stronger, and they’re following through,” said Priyanka Kishore, head of India and Southeast Asia economics at Oxford Economics Ltd. in Singapore. “Part of it is education,” for public consumption, while for the market, it’s about “giving out a feeler, and influencing a decision from analysts.”
Malaysia and Singapore have traditionally only published statements for their policy decisions, but the rest of the five Southeast Asian central banks have moved to video-streaming. Here’s how they are boosting their communications efforts:
Thailand
Bank of Thailand policy makers used Facebook Live for a debut live-stream of their decision on Aug. 8 to keep interest rates unchanged.
While the bank’s Facebook page has kept up a lively conversation for a couple of years already, the adoption of Facebook Live is an “extension of the static Facebook message which allows the general public and analysts to follow BoT events directly and at their own convenience,” said Assistant Governor Chantavarn Sucharitakul, a spokesperson for the bank.
Other government agencies, like the National Economic and Social Development Board, which releases quarterly economic growth data, already use Facebook Live.
Chantavarn said that despite the broad outreach effort, the question-and-answer session for the central bank policy decision is still reserved for professional media. The bank also holds private sessions with researchers, analysts and market participants to discuss more technical details of the policy deliberations.
Indonesia
The social media team at Bank Indonesia has picked up its presence under new Governor Perry Warjiyo. The YouTube live-stream videos of the central bank meetings, which began on a quarterly basis in November 2015, are now conducted monthly.
The central bank has its own channel on YouTube, and last year added an Instagram account to its social media repertoire, which also boasts a Facebook feed started in 2016 and a popular Twitter following.
“Communications are intensified because Governor Perry believes transparency and communication are an integral part of a central bank’s way to strengthen policy credibility,” said Agusman, a spokesman for the central bank who goes by one name. “Governor Perry says that managing and influencing expectations in the money market are an important part of a policy’s effectiveness.”
Bank Indonesia — which has been the most aggressive in Asia with four rate hikes since mid-May — also has the general public in mind with its social media outreach, including its efforts to minimize disinformation, Agusman said.
“The main audience target of live-streaming are market players, banks, academics, economists, who directly need complete information from the central bank,” he said. “But in practice, live-streaming is also watched by students, young people and netizens who generally want to learn.”
Philippines
Bangko Sentral ng Pilipinas live-streamed its policy announcement for the third time earlier this month, when it raised interest rates by a bigger-than-usual 50 basis points to curb inflation.
“We hope that through live broadcasts we could expand Filipinos’ understanding of monetary policy,” including an estimated 67 million Facebook users, Governor Nestor Espenilla said in a written statement in response to questions about the communications strategy. Based on readability, the central bank’s statements alone “may not really be for a wider audience,” according to tests conducted by the BSP.
Given that the central bank itself scored low in a recent public survey on how consumers learn about its operations, “there is ample room to expand the BSP’s digital presence,” said Espenilla. The goal is also to see policy messages in those live-stream videos organically replicated — through re-posts of video clips or graphics built off information provided during the briefings, he said.
The central bank has faced criticism this year of being too slow to act against inflation and sending mixed signals about policy intentions, which analysts say contributed to the peso’s slide. The currency has slumped 6.6 percent against the dollar so far this year, making it one of the worst performers in Asia.
Espenilla said the central bank has ramped up its Twitter presence and its meetings with private-sector economists and market analysts. The feedback so far has been that the meetings allowed the officials to “effectively explain” decisions and intentions, he said.
The broadening of communications is particularly vital amid turbulent times in the global economy, the governor said.
“Most central banks would agree that communication is particularly challenging during a tightening cycle,” he said. “Thus, live streaming allows direct communication to stakeholders with less room for misinterpretation.” — Bloomberg