This paper presents an analysis of the relationship between the governance of financial stability and the communication policy of Central Banks in the Arab region, and their effectiveness in reducing the fluctuations of the financial cycle in twelve Arab countries during the period (2005-2020). In this paper, we will provide a theoretical framework for how to assess systemic risks by the Central Banks, and then attempting to measure the role of the existence of specific characteristics for the governance of financial stability in the Central Bank along with the existence of an effective framework for communication in reducing the fluctuations of the financial cycle. The paper reveals that the Central Banks communication policies are effective in reducing the possibility of a crisis especially if they have a financial stability committee with power. The paper recommends the decision makers at the Central Banks to continuing pay attention for the financial stability governance framework and the communication strategies.
