The European Central Bank (ECB) influences market expectations of future monetary policy through its statements at press conferences. This communication can have similar effects to conventional monetary policy instruments, such as interest rate decisions. The tone and direction of the statements are crucial in this regard. The Bundesbank uses artificial intelligence (AI) to efficiently analyse the ECB’s statements. To this end, it has developed its own AI model: the Monetary Intelligent Language Agent (MILA).  

Contents

• Use of AI
  How the Bundesbank works with AI to analyse economic data
• Results
  What insights the Bundesbank gains by using AI
• Human expertise and risks
  Why we still need experts’ interpretations 

Expert 

Dr Dimitrios Kanelis works as an economist at the Bundesbank. He investigates and develops new AI-based models for the analysis of monetary policy communication and for financial market analysis. In his free time, however, our expert prefers to read historical books or to practise standard and Latin dance steps instead of using AI models. He drinks his coffee black. “With milk if I have to. But never with sugar.” 
 

Participation

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