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Felix Geiger @flxgeiger.bsky.social · 09/04/2025

A recent report featuring key results of MILA: publikationen.bundesbank.de/publikatione...

publikationen.bundesbank.de

Monetary policy communication according to artificial intelligence

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Felix Geiger @flxgeiger.bsky.social · 09/04/2025

Our @bundesbank.de research paper dives into the methodology. www.bundesbank.de/resource/blo...

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Felix Geiger @flxgeiger.bsky.social · 09/04/2025

MILA’s granular approach outperforms typical full-document analyses in replicability and consistency. Despite the stochastic nature of language models, it delivers consistent results - so no need to lower the temperature to ensure replicability 3/

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Felix Geiger @flxgeiger.bsky.social · 09/04/2025

MILA combines text mining, a large language model (LLama 3.1 70B), mathematical formulas and topic modeling 2/

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Felix Geiger @flxgeiger.bsky.social · 09/04/2025

𝗡𝗲𝘄 𝗥𝗲𝘀𝗲𝗮𝗿𝗰𝗵: 𝗠𝗜𝗟𝗔 (𝗠𝗼𝗻𝗲𝘁𝗮𝗿𝘆-𝗜𝗻𝘁𝗲𝗹𝗹𝗶𝗴𝗲𝗻𝘁 𝗟𝗮𝗻𝗴𝘂𝗮𝗴𝗲 𝗔𝗴𝗲𝗻𝘁) We introduce MILA—a new AI-driven solution for analyzing central bank communication. MILA operates on individual sentences by using the macro and in-document context. 1/n

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Deutsche Bundesbank @bundesbank.de · 09/04/2025

Guten Morgen aus #Frankfurt! Wir begrüßen Sie auf unserem offiziellen Bluesky-Kanal!👋 Ab heute halten wir Sie hier über alles Wissenswerte rund um die #Geldpolitik, #Bankenaufsicht und #Finanzstabilität sowie über viele weitere Aufgaben der #Bundesbank auf dem Laufenden. #HerzlichWillkommen

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Felix Geiger @flxgeiger.bsky.social · 20/03/2025

➡️ Recently, the stance has been more accommodative than policy rates suggest. This reflects lower longer-term rates and narrower spreads on sovereign and corporate bonds by historical standards, i.e. given the policy rate level, long-term rates and risk spreads historically tended to be higher. \5

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Felix Geiger @flxgeiger.bsky.social · 20/03/2025

➡️ Between 2022 and 2023, the extent of monetary policy tightening was comparable to the actual rise in key interest rates, but tightening began six months earlier given anticipation effects already reflected in financial market prices. \4

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Felix Geiger @flxgeiger.bsky.social · 20/03/2025

➡️ The rate suggests that the monetary policy stance between 2012 and 2021 was considerably more accommodative than signalled by policy rates. This comes not as a surprise, given that the proxy rate picks up impact of asset purchases and forward guidance during the effective lower bound regime. \3

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Felix Geiger @flxgeiger.bsky.social · 20/03/2025

➡️ The proxy rate maps common movements of a set of financial market variables to the actual DFR policy rate level following Doh and Choi (2016). 2\

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Felix Geiger @flxgeiger.bsky.social · 20/03/2025

How to measure the broader monetary policy stance in the euro area? In our latest @bundesbank.de report, we present the proxy monetary policy rate, which combines information from the risk-free yield curve and risk assets. 1\ #EconSky @plieberk.bsky.social

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Felix Geiger @flxgeiger.bsky.social · 18/03/2025

Since 2011, the tone of the ECB Executive Board’s monetary policy speeches has evolved in line with the ECB press conferences and the macroeconomic environment in the euro area. Some dispersion of speeches visible during the recent tightening and easing phase. \4

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Felix Geiger @flxgeiger.bsky.social · 18/03/2025

𝗦𝗵𝗶𝗳𝘁𝗶𝗻𝗴 𝗽𝗼𝗹𝗶𝗰𝘆 𝘀𝗶𝗴𝗻𝗮𝗹𝘀: MILA detects a dovish stance in 2020; a balanced inflation narrative in 2021, but still a dovish rate outlook; then a hawkish shift in 2022-23. By 2024, communication became more balanced. \3

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Felix Geiger @flxgeiger.bsky.social · 18/03/2025

𝗔𝗜-𝗽𝗼𝘄𝗲𝗿𝗲𝗱 𝗮𝗻𝗮𝗹𝘆𝘀𝗶𝘀: MILA provides structured assessments of ECB communication from 2011 to 2024, analyzing around 50,000 sentences on an individual basis. \2

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Felix Geiger @flxgeiger.bsky.social · 18/03/2025

At @bundesbank.de, we have developed 𝗠𝗜𝗟𝗔 (𝗠𝗼𝗻𝗲𝘁𝗮𝗿𝘆-𝗜𝗻𝘁𝗲𝗹𝗹𝗶𝗴𝗲𝗻𝘁 𝗟𝗮𝗻𝗴𝘂𝗮𝗴𝗲 𝗔𝗴𝗲𝗻𝘁) - an AI tool designed to evaluate ECB communication, assessing individual sentences from monetary policy statements and speeches given in-document as well as the macro context. \1 #EconSky

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Felix Geiger @flxgeiger.bsky.social · 06/03/2025

The script has flipped 🌎 - Euro area macro drives euro yields aka Bunds up - US macro drives these yields down.

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Felix Geiger @flxgeiger.bsky.social · 06/03/2025

US Treasuries: slide. 🛝 Bunds: hold my beer. 🍺

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Isabel Schnabel 🇪🇺🇺🇦 @isabelschnabel.bsky.social · 26/02/2025

Yesterday I delivered a speech with the title “No longer convenient? Safe asset abundance and r*” at the @bankofengland.bsky.social's #2025BEARconference. Let me summarise the main messages in a 🧵. 1/16

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Felix Geiger @flxgeiger.bsky.social · 19/02/2025

This is an important observation by @isabelschnabel.bsky.social: Typically, tight monetary policy transmits also by increasing risk premia on financial markets. Without it, transmission is notably weaker. During the recent hiking cycle, we did not observe this feature. bsky.app/profile/flxg...

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Isabel Schnabel 🇪🇺🇺🇦 @isabelschnabel.bsky.social · 19/02/2025

In my interview with @financialtimes.com published today I explained my current thinking about the @ecb.europa.eu ’s monetary policy and gave some personal reflections on the upcoming update of our monetary policy strategy. Let me briefly summarise the main points in a 🧵. 1/16

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European Central Bank @ecb.europa.eu · 19/02/2025

As we can no longer be confident that our monetary policy is restrictive, the direction of travel is less clear, Executive Board member @isabelschnabel.bsky.social tells @financialtimes.com. We are nearing the point where we may need to pause or halt our rate cuts. www.ecb.europa.eu/press/inter/...

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Isabel Schnabel 🇪🇺🇺🇦 @isabelschnabel.bsky.social · 07/02/2025

Many #ECB watchers have waited for this article. Chart A shows the huge model uncertainty surrounding the estimates. Adding parameter and filter uncertainty, data revisions and considering all models (not just those available for Q4 2024), you can see what we know about r* ... very little.

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Moritz Kuhn @mokuhn.bsky.social · 06/02/2025

To all econ students on the market and advisors: I am thinking about filling an additional postdoc position at the University of Mannheim working on portfolio choice, wealth inequality, and labor markets. Interested? If yes, please let me know! sites.google.com/site/kuhneco...

sites.google.com

Moritz Kuhn

Moritz Kuhn Professor Department of Economics University of Mannheim L 7, 3-5, 68161 Mannheim, Germany mokuhn@uni-mannheim.de +49 621 181 1929 Office hours: please send an email (judith.price@uni-ma...

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International and Monetary Economics Network @intmon.bsky.social · 03/02/2025

It's high time to have another look at interesting papers like this one! "Anticipation effects of protectionist U.S. trade policies" by Norbert Metiu. Article in the Journal of International Economics: www.sciencedirect.com/science/arti... Working paper: papers.ssrn.com/sol3/papers....

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Felix Geiger @flxgeiger.bsky.social · 31/01/2025

Estimates are based on affine / lower-bound term structure models augmented by survey information. US: Kim and Wright (2005, 2011) EA: Geiger and Schupp (2019)

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Felix Geiger @flxgeiger.bsky.social · 31/01/2025

Still, there are signficant level differences between US and EA yield curve components. 3/n

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Felix Geiger @flxgeiger.bsky.social · 31/01/2025

Corresponding change in average short-term rate expectations shows close co-movement since 1999 with EA expectations typically lagging its US peers (if at all). 2/n

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Felix Geiger @flxgeiger.bsky.social · 31/01/2025

🧵As 𝘁𝗲𝗿𝗺 𝗽𝗿𝗲𝗺𝗶𝘂𝗺𝘀 took center stage these days - Chart depicts dynamics for US and EA 1/n ➡️99-12: strong co-movement ➡️12-20: EA term premium collapses relative to US ➡️22-24: de-compression more pronounced in EA ➡️since mid-24: degree of US term premium rise is only partly matched by EA #EconSky

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Justin Wolfers @justinwolfers.bsky.social · 24/01/2025

An executive order to defeat inflation: "I hereby order the heads of all executive departments and agencies to deliver emergency price relief, consistent with applicable law, to the American people and increase the prosperity of the American worker." www.whitehouse.gov/presidential...

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Justin Wolfers @justinwolfers.bsky.social · 23/01/2025

The folks obsessively posting about egg prices for the past few years have gone strangely quiet just as egg prices hit an all-time high.

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Felix Geiger @flxgeiger.bsky.social · 21/01/2025

The 2022–2023 𝗽𝗼𝗹𝗶𝗰𝘆 𝗿𝗮𝘁𝗲 𝗵𝗶𝗸𝗲𝘀 likely dampened risk appetite. At the same time, a rapid economic recovery supported risk-taking, mitigating monetary policy’s impact via compressed risk premiums. 5/n

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Felix Geiger @flxgeiger.bsky.social · 21/01/2025

The 𝗿𝗶𝘀𝗸 𝗮𝗽𝗽𝗲𝘁𝗶𝘁𝗲 𝗰𝗵𝗮𝗻𝗻𝗲𝗹 amplifies monetary policy’s impact on inflation and GDP. Without it, transmission is notably weaker. 4/n

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Felix Geiger @flxgeiger.bsky.social · 21/01/2025

𝗠𝗼𝗻𝗲𝘁𝗮𝗿𝘆 𝗽𝗼𝗹𝗶𝗰𝘆 in the euro area and the US significantly influences risk sentiment, with diverse exchange rate effects. 3/n

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Felix Geiger @flxgeiger.bsky.social · 21/01/2025

𝗧𝗶𝗺𝗲-𝘃𝗮𝗿𝘆𝗶𝗻𝗴 𝗿𝗶𝘀𝗸 𝗮𝗽𝗽𝗲𝘁𝗶𝘁𝗲 amplifies risk premiums, especially during crises. This is a robust feature across various indicators including the work by @michaeldbauer.bsky.social and Carolin Pflueger (et al). 2/n

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Felix Geiger @flxgeiger.bsky.social · 21/01/2025

🧵In our latest report of @bundesbank.de, we examine how 𝗶𝗻𝘃𝗲𝘀𝘁𝗼𝗿𝘀' 𝗿𝗶𝘀𝗸 𝗮𝗽𝗽𝗲𝘁𝗶𝘁𝗲 in the euro area interacts with 𝗺𝗼𝗻𝗲𝘁𝗮𝗿𝘆 𝗽𝗼𝗹𝗶𝗰𝘆 𝘁𝗼 𝘀𝗵𝗮𝗽𝗲 𝗺𝗮𝗰𝗿𝗼𝗲𝗰𝗼𝗻𝗼𝗺𝗶𝗰 𝗼𝘂𝘁𝗰𝗼𝗺𝗲𝘀. Key takeaways ⬇️1/n #EconSky

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Eintracht Frankfurt @eintracht.de · 17/01/2025

🥹❤️ only in Frankfurt! #SGE | #SGEBVB

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Johannes Hillje @jhillje.bsky.social · 17/01/2025

Das ZEW hat ausgerechnet, welche Einkommensgruppen von den Wahlprogrammen der Parteien jeweils am stärksten profitieren: www.sueddeutsche.de/projekte/art...

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Curd Knüpfer @curdknupfer.bsky.social · 09/01/2025

In case you were wondering how things are going in Germany & on X, after Elon Musk announced his support for the far-right "Alternative für Deutschland" (AfD) in the upcoming Federal election: The chart below shows sums of tweets x impressions by members of parliament over the past 7 days...🧵⤵️

Graph that shows the sum of tweets and their impressions by members of the German Bundestag (Parliament), clustered by party. The blue AfD is a clear outlier with around 400 tweets and just under 40 million impressions.

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Felix Geiger @flxgeiger.bsky.social · 16/01/2025

Great paper showing why the US economy keeps surprising to the upside despite high policy rates. ➡️Financial conditions may be loose with high stock valuations and compressed risk spreads ➡️For the economy these conditions matter ➡️By targeting financial conditions, Fed may reduce output volatility

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NBER @nber.org · 04/12/2024

Financial noise disrupts markets and the real economy. Monetary policy that targets financial conditions can stabilize the economy by recruiting arbitrageurs to trade against noise, from Ricardo J. Caballero, Tomás E. Caravello and Alp Simsek www.nber.org/papers/w33206

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European Central Bank @ecb.europa.eu · 16/01/2025

Account of the monetary policy meeting of the Governing Council of the ECB on 11-12 December 2024 www.ecb.europa.eu/press/accoun...

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Peter Tillmann @peterhtillmann.bsky.social · 14/01/2025

New paper: "𝗧𝗵𝗲 𝗘𝗺𝗼𝘁𝗶𝗼𝗻𝘀 𝗼𝗳 𝗠𝗼𝗻𝗲𝘁𝗮𝗿𝘆 𝗣𝗼𝗹𝗶𝗰𝘆". We measure the facial and vocal expressions of the ECB presidents at a high frequency. With @jens-klose.bsky.social, @sinemkandemir.bsky.social, Mamadou-Lamine Barry, Brenton J. Bruns and Victor Smirnov. The paper: lnkd.in/eR4AXeiz

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European Central Bank @ecb.europa.eu · 13/01/2025

Chief Economist Philip R. Lane tells @derstandard.at how we have made significant progress on our inflation target and that we need inflation to be sustainably at 2 per cent. Read his interview www.ecb.europa.eu/press/inter/...

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Falko Fecht @falkofecht.bsky.social · 09/01/2025

You are pursuing a PhD in economics or finance? You are particularly interested in banking and finance? You have strong empirical skills? You should apply for an RA position in the Research Centre @bundesbank.de ! Deadline: January 12th !!! 👇 #econsky www.bundesbank.de/en/career/jo...

bundesbank.de

Research Assistant in the areas of banking and finance / monetary policy implementation and transmission

in Part-time (19,5 hours)

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International and Monetary Economics Network @intmon.bsky.social · 09/01/2025

Worth thinking about! "Coordinating the Message: Media Coverage of Fed News and Market Reactions" by Sylvérie Herbert, Klodiana Istrefi, and Béatrice Sagna. www.banque-france.fr/en/publicati...

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