Hanging on Tiff’s Words: Communicating in Times of Uncertainty

David Gollom and Maddy Porter

The meticulously chosen words of central bankers have always been the subject of intense scrutiny, a focus that only sharpens during economic uncertainty. In the 90s, reporters even monitored the size of Alan Greenspan’s briefcase to predict potential rate cuts, an indicator known as the “Briefcase Barometer.” 

More recently, everyone from investors to aspiring homeowners in Canada hang on the words from Tiff Macklem, governor of the Bank of Canada. In April, a few carefully chosen words by Macklem—suggesting a June rate cut was ‘within the realm of possibilities’—made headlines, shifted public conversations, and had an impact on markets. While we are not economists, there’s a lesson here for businesses on the power of words in uncertain times. The language used for any subject or issue that will attract significant attention should be very intentional. Our CanTrust Index reveals that economic anxiety now far exceeds peak-COVID pandemic-related concerns. As analysts, reporters, business leaders, and people with mortgages to pay pour over quotes from Macklem’s announcements to decipher Canada’s economic outlook – words matter more than ever. 

Every business issue – fiscal or otherwise – has its nuances, including those faced by the Bank of Canada. Strategic and thoughtful communication is the cornerstone of navigating uncertain times. It can be the difference between alienating your audience and reassuring them. Here’s where to start: 

Build communications plans with vulnerability in mind

Uncertainty and change are inevitable, vulnerability is constant. Like central bankers trying to predict the path of inflation, no business can predict every difficult moment. Building a communications strategy that can pivot is an important place to start, but should regularly be pressure tested with simulations to keep pace with the evolving landscape of uncertainty.   

Communicate a clear, consistent, fact-based narrative to build trust

Central banks know what it feels like to be under the microscope. Even the slightest of diversions in their messaging can have large implications. Ample preparation is key – both with respect to a spokesperson (ideally, there should be just one for complex issues) as well as the messaging itself. Data-driven key messages are essential to contextualizing the narrative, therefore increasing the level of understanding for the audience. Failing to have clear, concise messages supported by data, delivered by a well-prepared spokesperson can do more harm than good.  

Provide frequent updates to all your stakeholders

During times of uncertainty, your stakeholders – including customers, employees, and shareholders – want more information and have much higher expectations. Businesses must maintain a regular cadence of clear and transparent updates during times of crisis. Central banks haven’t always gotten this right. The Reserve Bank of Australia (RBA), for instance, faced criticism for giving a closed-door briefing to major banks last year. The wave of public scrutiny promoted a review and recommendation for the RBA to communicate more broadly and consistently.  

Effective communication requires listening

Building trust means communication must flow both ways. Don’t just talk at your audience. Provide opportunities for questions and feedback and listen to learn, not just to respond. Use social media listening pros to help you hear the conversations you’re not in. This is especially crucial during moments that might have a material impact on people’s lives. Wherever possible, key messages should leave audiences feeling like their concerns are being reflected back at them, even when solutions are still being developed. 

Whether you agree or disagree with the monetary policies of central banks, their communication practices (good and bad) offer valuable lessons for businesses during uncertain times. If the pandemic taught us anything, it’s that change is the only constant, and our communication strategies must navigate this new normal.