How policymakers’ speeches and interviews move markets

This is an ECB research blog, not a policy signal: an academic event study of how inter-meeting speeches and interviews move euro area markets. It documents that reactions to informal communication can match those to formal Governing Council announcements, that the cumulative effect of the many speeches dominates at longer maturities, and that these events sharpen estimates of policy transmission. There is no read on the current stance, no guidance and no vote, so it changes nothing for the front end or the curve.

What’s new: Nothing material for policy expectations. This is a methodological piece built on the Euro Area Communication Event Study Database spanning January 1999 to early 2024, published alongside Istrefi, Odendahl and Sestieri (2026). It carries no assessment of the prevailing policy stance, no rate signal, no Governing Council vote or balance of views. That central bank communication moves markets is already well understood and priced as a general phenomenon.

KEY FINDINGS

• Speeches shift OIS rates in the same direction as the policy decision that follows, but the effect is asymmetric: signalling is stronger ahead of tightening than ahead of easing, and the pattern is unclear before meetings with no policy change. If the desk treats pre-meeting rhetoric as a leading indicator, the historical tilt says pre-hike chatter is the higher-conviction signal and pre-cut chatter runs weaker.
• Among inter-meeting speakers the ECB President has the largest average impact on the OIS 2Y, followed by the President and Governors of the four largest NCBs, then Executive Board members. It argues for screening non-Executive-Board national central bank speakers, not just the President and Board, for front-end signal.
• Cumulative effects of inter-meeting communication and formal announcements are similar at the OIS 2Y (681bp versus 718bp), but at longer maturities inter-meeting events become up to twice as influential. Speeches matter more than meetings for the long end of the curve, where the term premium and policy path are set.
• Around 45% of formal policy announcements produced a significant market reaction, while a smaller share of the roughly 5,000 inter-meeting events did, yet their volume made total Euro Stoxx 50 moves larger (273pp versus 98pp). Frequency, not hit rate, is why external communication aggregates to a bigger equity-market footprint.

FROM THE DOCUMENT

Before rate hikes, speeches and interviews push rates upwards. Before rate cuts, they push rates downwards, albeit more modestly.

Therefore, of the inter-meeting speakers, the ECB President has the largest impact on average, followed closely by the President and Governors of the four NCBs and then the ECB Executive Board members.

Our findings show that the market reaction to inter-meeting communication events is often as large as the reaction to formal announcements of Governing Council decisions.

At longer maturities, inter-meeting communication events become more influential, with cumulative effects up to twice as large as those of formal policy announcements.