Gary Cameron | Reuters
The Federal Reserve building in Washington.
The Federal Reserve remains the major central bank with
the best communication practices, a new survey showed, but a detailed
look at the results signals headwinds.
The Bank of England ranked second in Barclays' fourth 'Survey of Central Bank Communication', followed by the Bank of Japan and the European Central Bank, respectively. Each maintained its position from the 2013 survey.
Read MoreWhy the market is losing its faith in the Federal Reserve
While the Fed has topped the survey since the first edition in 2007, the U.S. central bank's overall score declined for the second straight reading, falling below the
7 level for the first time due to lower scores for communication with the public. The rating for communication with the public was 5.9, well below the 7.2 scored for its communication with financial markets.
The Bank of England ranked second in Barclays' fourth 'Survey of Central Bank Communication', followed by the Bank of Japan and the European Central Bank, respectively. Each maintained its position from the 2013 survey.
Read MoreWhy the market is losing its faith in the Federal Reserve
While the Fed has topped the survey since the first edition in 2007, the U.S. central bank's overall score declined for the second straight reading, falling below the
7 level for the first time due to lower scores for communication with the public. The rating for communication with the public was 5.9, well below the 7.2 scored for its communication with financial markets.
"Home bias" also weighed on the Fed's overall score, with
North America-based participants making much harsher assessments of the
Fed compared with foreign respondents. In 2013 there was little
difference between the groups.
Read MoreWait till you see what Alan Greenspan's been saying
Apart from grading individual central banks, the survey also aims to discover which types of communications are important.
Policy meeting minutes and press conferences were voted the most valuable channels of central bank communication. But fewer than half of the survey participants felt publishing individual voting records is essential or important, while majority called conditional interest rate projections "distracting."
BOJ catching up
The Bank of Japan (BOJ) was the only major central bank that saw its numbers improve or hold steady in every category.
Read MoreBoJ bazooka to spark currency war
Read MoreWait till you see what Alan Greenspan's been saying
Apart from grading individual central banks, the survey also aims to discover which types of communications are important.
Policy meeting minutes and press conferences were voted the most valuable channels of central bank communication. But fewer than half of the survey participants felt publishing individual voting records is essential or important, while majority called conditional interest rate projections "distracting."
BOJ catching up
The Bank of Japan (BOJ) was the only major central bank that saw its numbers improve or hold steady in every category.
Read MoreBoJ bazooka to spark currency war
"The slight improvement in the BoJ's overall score was
driven by an improvement in assessment of foreign respondents (to 6.0
from 5.9), whereas domestic respondents were unchanged at 5.8," Barclays
analysts said.
"While the 'domestic versus foreign' dynamics driving recent changes in the scores of the BoJ and the Fed differ, one feature they have in common is that their respective domestic respondents grade their central bank more harshly than foreign respondents," they said.
New entrants
Barclays also expanded the survey to include the central banks of Australia, Brazil, China, India, Indonesia, Mexico, Russia, South Africa, South Korea and Turkey. However, this group was ranked separately from the principal four banks due to the smaller sample size of responses received.
Read MoreAustralia's central bank keeps rates low, consumers encouraged
In the new group, the Reserve Bank of Australia ranked first with 70 percent of respondents saying the bank did "exceptionally well" or "well" on conveying its objectives, predictability, and credibility. The Reserve Bank of India ranked second while the Central Bank of the Republic of Turkey was the worst performer.
"While the 'domestic versus foreign' dynamics driving recent changes in the scores of the BoJ and the Fed differ, one feature they have in common is that their respective domestic respondents grade their central bank more harshly than foreign respondents," they said.
New entrants
Barclays also expanded the survey to include the central banks of Australia, Brazil, China, India, Indonesia, Mexico, Russia, South Africa, South Korea and Turkey. However, this group was ranked separately from the principal four banks due to the smaller sample size of responses received.
Read MoreAustralia's central bank keeps rates low, consumers encouraged
In the new group, the Reserve Bank of Australia ranked first with 70 percent of respondents saying the bank did "exceptionally well" or "well" on conveying its objectives, predictability, and credibility. The Reserve Bank of India ranked second while the Central Bank of the Republic of Turkey was the worst performer.
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