Building blocks of central banks' communication

Data: Introductions to annual reports of European central banks from 1999 to 2020 (collected manually from official sites).

Analysis: preprocessing (NLTK, spaCy), phrases detection (Gensim), topic modeling (Gensim).

Visualzation: Tableau.

Description: I build on a corpus of introductions to annual reports of European central banks (CBs) that constituted the Eurosystem, the monetary authority of the Eurozone. Eurosystem comprises the European Central Bank (ECB) and national central banks (NCBs) that adopted the euro as a single currency. In the analysis, I address the communication of 10 NCBs that launched the euro in 1999*, and the CB of Greece that joined the Eurosystem in 2001.

I split texts into chunks of comparable size, first dividing texts into paragraphs and then merging paragraphs that are too small. After, I train the LDA topic model (Gensim implementation). Topic modeling is an unsupervised clustering algorithm that defines the main themes of a text collection. I fit the model of 25 topics on the whole corpus, and these topics illustrate the focal points of CBs' attention in the period from 1999 to 2020.

In Tableau, I visualize topics’ evolution over years. The visualization allows to compare the use of topics by each CB with the annual average of all CBs (upper chart). As well, I show how the attention to each topic changes for every CB (lower chart).

*The CB of Portugal, the 11th NCB to start the Eurosystem, is excluded from the analysis for the lack of data.