The Reserve Bank, which has faced criticism for its engagement with the media and financial analysts, has turned to social media to sell its message after polling showed ordinary Kiwis don't hold the bank in high regard.
An external stakeholder engagement survey conducted by Ipsos New Zealand in 2014 found the 553 ordinary people surveyed had a much lower opinion of the central bank than the 356 stakeholders polled.
RBNZ head of communications Mike Hannah told an Institute of Directors audience in Christchurch yesterday that the gap between the two groups had a "significant influence" on how the central bank has interacted externally over the past two-and-a-half years. Another survey will be held in the first half of next year.
Hannah said the traditional news media has been "fundamentally challenged by the attraction of advertising revenue to the likes of giant web platforms such as Google and Yahoo!" he said, referring to the waning Yahoo! web portal that has been sold to Verizon.
Google and Facebook capture the lion's share of digital advertising in New Zealand.
Hannah said the central bank had sought to engage with the public through social media channels including Youtube, Twitter, Facebook and SoundCloud.
The bank has also used "native advertising" - Hannah cited a sponsored story and quiz on Fairfax New Zealand's Stuff website to promote its new bank notes.
"These digital channels are designed to offer explanations of our policy and activities in more accessible, less technical language than is required for formal policy or regulatory statements," Hannah said.
Still, the central bank isn't yet ready for a robust two-way conversation through social media channels, saying it needed to avoid the risk of "our statements in an informal channel being read as public signals".
The accelerating growth of digital technologies "has reinforced the need to be aware of trends and to adopt those technologies that best suit the bank's roles and relationships," and it's actively looking at how it can best invest in them, Hannah said.
The Reserve Bank also has to be careful about the way it communicates with both the media and financial market participants, given it can influence financial prices, he said.
The Reserve Bank's communication has been questioned by economists and financial analysts, especially last year when traders were wrong-footed by a speech from Wheeler when he said he didn't need to take a "mechanistic" approach and only take headline inflation into account when setting policy, only to cut the benchmark rate at his next meeting due to softening inflation expectations.
One of Wheeler's more ardent critics has been Bank of New Zealand head of research Stephen Toplis, whose commentary ahead of the May monetary policy statement earned a sternly worded letter from the governor to Toplis's boss, BNZ chief executive Anthony Healy, seeking to rein in the critical tone.
Hannah yesterday said the central bank frequently interacts with market participants throughout the working day.
"We are conscious that monetary policy is an area where individuals, be they market participants or others, can have widely different views," Hannah said. "We understand the importance of seeking to be transparent and consistent in our messaging, and to be careful to signal any changes in our messaging."
The Reserve Bank's relationship with traditional media has taken a knock in the past year after it ended a long-standing policy of granting analysts and journalists access to policy documents and economic releases in an embargoed lock-up after a MediaWorks reporter broke the rules by secretly sending the details early to their newsroom.
Hannah acknowledged that deterioration yesterday, but said: "the reputational risk for the central bank outweighed the relationship risk with the media", and to make up for the loss of access the bank had boosted the number of one-on-one interviews with the media, which had been sparse in the early years of Wheeler's administration.
Hannah also used his speech to defend the number of off-the-record speeches that the bank gives to business audiences, saying "we do not see these off-the-record events as a 'story' but as vehicles for enhancing understanding, even educational," which didn't stray from the bank's policy line.
Those speeches to business audiences were "valuable opportunities" for the bank to hear from a lot of stakeholders, and were typically short presentations followed by long question-and-answer sessions. Hannah said the bank aims to achieve a wide regional spread, and of the 109 speeches in New Zealand last year, 39 were in Auckland, 33 in Wellington and eight in Christchurch, with the rest scattered around the country. Another 12 were overseas.