Headline: ECB/Nagel: Clearer Communication, Not Dot Plots, Needed by ECB

Bundesbank President and European Central Bank (ECB) policymaker Joachim Nagel stated that the ECB needs to improve how it communicates its policy intentions and uncertainties. However, he noted that adopting the U.S. Federal Reserve's "dot plot" projection method is not a desirable option. Nagel joined a long list of policymakers opposing the dot plot, suggesting that it could threaten independence and that the improvement in the bank's signaling is not entirely clear. Speaking at Harvard University, Nagel said, "I do not see a compelling case for introducing dot plots for the Eurosystem." He continued, "This could potentially impinge on the Governing Council's independence." Instead, Nagel argued that the ECB should enhance its existing signaling tools and use the forthcoming review to achieve this. He mentioned, "One approach could be improving the communication of our existing uncertainty measures. Another could be developing enhanced fan charts alongside new measures, such as scenario and sensitivity analyses."