Scientists from the ZEW research institute in Mannheim have now examined more than 3,800 speeches by central bankers from the euro area in order to find out which topics are the focus and how the focus has changed over the years.

One observation: While climate change and its consequences were mentioned much more frequently in central banker speeches than in previous years – there is even talk of the “shooting star” among all topics – its share has recently declined somewhat.

On the other hand, the issue of price stability, which the central bankers have of course talked about a lot in the past, is now number one by an even greater margin.

Christian Siedenbiedel

Editor in Business.

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The method: For the study, which was funded by the Stube Foundation, the researchers subjected speeches by ECB Governing Council members to computer-aided text analysis.

They wanted to know how often certain terms and certain groups of terms appear in these public statements from the years 1999 to 2022.

For example, “inflation” – the term occurred 25,503 times – then belongs to the group of terms “price stability”.

The term “price stability” itself appeared 11,692 times in the speeches.

Then the percentages of the different groups of terms in the speeches were compared over time.

The number of speeches has increased significantly

"The study measures the attention paid by members of the Governing Council to various implicit and explicit monetary policy objectives," write the study's authors Friedrich Heinemann and Jan Kemper.

While price stability is the primary goal of the European Central Bank according to the Maastricht Treaty, other societal goals could also play a role in monetary policy considerations and decisions.

In any case, based on the analysis of the text, it can be stated that the Council members' attention to economic and social goals beyond price stability has increased since the introduction of the euro, says economist Heinemann.

Attention to the primary goal of price stability fluctuates over time, also depending on the respective inflation rate:

It was also examined who from the Governing Council speaks publicly, how often and for how long.

"Although all euro countries have (almost) equal voting rights in the Governing Council, the 'power of words' is unequally distributed," says Heinemann.

"Here, the big countries are far ahead, their central bank governors determine the discourse."

With regard to the number of speeches per year, which has increased overall, the presidents and governors of the national central banks in the euro area have now overtaken the ECB Executive Board.

France, Spain and Germany are now ahead, followed by the smaller and above all the Eastern European countries such as Lithuania and Slovakia.

When it comes to the length of the speeches, Italy and Spain are at the top – Estonia, on the other hand, was particularly short.

Favorite topics of individual central bankers

The text analysis also suggests that there is a north-south divide when it comes to price stability, says study author Heinemann.

The topic is particularly common among central bankers from Belgium, Finland, France and Germany, and particularly rarely among central bankers from Italy or Portugal.

On the other hand, the governors of the central bank in Greece have talked a great deal over the years about national debt, while those in Portugal have talked about financial stability.

Germany leads on the issue of the "bond market".

The researchers also examined the speeches over time for individual members of the Governing Council.

"As the head of the Irish central bank, Philip Lane, who is now the ECB's chief economist, rarely spoke about the issue of price stability - that only changed when he moved to the ECB Executive Board, since then he has often discussed the topic," said Heinemann.

What stands out about ECB President Christine Lagarde is how much she dominates the debate on the relationship between monetary and climate policy: "She leads the field of all Council members in terms of the proportion of this topic in their own speeches," said Heinemann.

Your predecessor Mario Draghi, on the other hand, practically never mentioned this topic.

The wide opening of the monetary policy discourse for a large bouquet of goals obviously reflects the strategy of signaling the social responsibility of monetary policy, said Heinemann: "In the current phase, in which the ECB has to regain confidence in its stability orientation, it is urgently advised to to correct the communication of the last few years - it must clearly signal that price stability remains the most important goal in the event of conflicting goals.