The Voice of Monetary Policy

We develop a deep learning model to detect emotions embedded in press conferences after the Federal Open Market Committee meetings and examine influence of detected on financial markets. find that, controlling for Reserve’s actions sentiment policy texts, positive tone voices Reserve chairs leads significant increases share prices. Other variables also respond vocal cues from chairs. Hence, how messages are communicated can move market. Our results provide implications improving effectiveness central bank communications. (JEL D83, E31, E44, E52, E58, F31, G14)