A Time Series Analysis of Emotional Loading in Central Bank Statements
This work addresses the problem of understanding emotional influences in central bank communication for economists and policymakers, though it is incremental as it applies existing emotion analysis methods to new data.
The study analyzed emotional content in ECB and Fed press statements from 1998 to 2019, finding patterns in valence, arousal, and dominance, and revealing correlations between economic conditions and dominance, as well as an impact of the president in office.
We examine the affective content of central bank press statements using emotion analysis. Our focus is on two major international players, the European Central Bank (ECB) and the US Federal Reserve Bank (Fed), covering a time span from 1998 through 2019. We reveal characteristic patterns in the emotional dimensions of valence, arousal, and dominance and find---despite the commonly established attitude that emotional wording in central bank communication should be avoided---a correlation between the state of the economy and particularly the dominance dimension in the press releases under scrutiny and, overall, an impact of the president in office.