By Tom Fairless 

FRANKFURT -- The European Central Bank is considering terminating an unusual communications policy whereby its chief economist placed private calls to banks and investors shortly after policy meetings, a practice that had raised eyebrows among financiers and central-bank officials.

Starting in March last year, Philip Lane, the chief economist, spoke directly with a select group of global institutions in the hours after the bank's policy decisions, in an effort to clarify its sometimes-puzzling public pronouncements.

The calls, reported in early December by The Wall Street Journal, broke with the central bank's usual practice of delivering information to all market participants at the same time. They were made to big investors such as BlackRock Inc. and banks such as Goldman Sachs Group Inc. and JPMorgan Chase & Co.

After the calls were revealed, Mr. Lane initially said he planned to continue them.

But in a letter to a Dutch member of the European Parliament, published Friday on the central bank's website, ECB President Christine Lagarde said the bank was reconsidering the format of the calls.

"The ECB is continually learning and reviewing its policies and practices with a view to making them as effective as possible -- this is also true for the field of communication," Ms. Lagarde wrote in the letter, which addressed questions about Mr. Lane's calls from Dutch politician Derk Jan Eppink.

In the U.S., the Federal Reserve has a blackout period of 12 days that runs until a full day after policy meetings, during which Fed officials don't speak publicly or privately to investors. The Bank of England briefs analysts shortly after its policy decisions, but all analysts are briefed at the same time, and any who want to can join.

Mr. Lane's calls began on March 12, when Ms. Lagarde stunned traders by suggesting at a news conference that the central bank wouldn't prop up Italy's bond market. Ms. Lagarde, a former International Monetary Fund managing director and French finance minister, hadn't worked in a central bank before she took the helm at the ECB in November last year.

In her letter on Friday, Ms. Lagarde said Mr. Lane's calls had sought to "facilitate systematic exchanges on newly published information," and that Mr. Lane had rotated between leading financial institutions in an effort to be even handed.

The letter discussed the calls in the past tense. It didn't suggest any alternative communication strategies that the ECB might adopt.

According to his public diary, Mr. Lane called eight global banks and investors after the ECB's policy meeting on Oct. 29, including Bank of America and Barclays. His subsequent diary entries haven't yet been published.

Bankers and central-bank officials had warned that the practice risked privileging large investors with sensitive information. Neither Ms. Lagarde's predecessor, Mario Draghi, nor his chief economist, Peter Praet, made similar calls during their last two years in office.

Write to Tom Fairless at


(END) Dow Jones Newswires

January 22, 2021 14:37 ET (19:37 GMT)

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