📝Model Ranks De Cos More Dovish Than Peers: Commerzbank

The fundamental monetary policy stance also tends to favor de Cos. According to our AI-based analysis of speeches, interviews, and comments, de Cos’s statements during his tenure on the ECB Governing Council were almost consistently noticeably more “dovish” than those of his Dutch counterpart (Chart 1). For this analysis, we use a large language model to classify the statements of ECB Governing Council members on a scale from “dovish” to “hawkish” as an index ranging from -1 to +1 and use this to generate a separate time series for each council member. A comparison with the median across all ECB Governing Council members suggests that de Cos is among the monetary policy doves, even though his communication at times even hovered slightly above the median during the high-inflation phase of 2022–23. In contrast, Knot was considered a monetary policy hawk for many years. It appears that it was only with his emerging ambitions to succeed Lagarde that his communication shifted toward the neutral camp. Especially against the backdrop of rising government debt in numerous countries—and bearing in mind the vehemence with which the dovish Draghi fought the sovereign debt crisis—many governments are likely to prefer a dovish ECB president. - Commerzbank