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.

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The slight slowdown of consumer price inflation in Germany in November does not yet constitute the beginning of lower inflation rates. Even though energy prices are dragging inflation, producer prices have drastically increased in the past year. Our estimates indicate that inflation rates will remain close to current levels until the end of 2023 and decrease only in 2024. Given the current fragile economic situation, restrictive monetary policy is not recommended. Rather, central banks should act attentively to prevent raising inflation expectations.

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