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Publikationen // 15.05.2006
solely on this indicator performs worse than the baseline. The results are confirmed by out of sample analysis where the determination of the wording indicators’ weights is based on the early ECB period which [...] observers. We then integrate this indicator into a standard Taylor type ordered probit model for the explanation of the interest rate. We show that the wording indicator can improve the model’s fit when [...] the monthly press conferences. Based on a counting of certain signal words we construct a wording indicator reflecting the “hawkishness” of monetary rhetorics. For the construction, we develop an objective
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