Study Results from Queen Mary University of London Update Understanding of Investment (Decoding Central Bank Communications With Large Language Models): Investment

2026 MAY 29 (NewsRx) -- By a News Reporter-Staff News Editor at Economics Daily Report -- Current study results on Investment have been published. According to news reporting from London, United Kingdom, by NewsRx journalists, research stated, “This paper examines the effects of Fed announcements on market expectations about interest rates from a linguistic perspective. A simple framework using large language models is developed to measure the proposed ‘Procedural Linguistic Minutes Information Shocks’ (PLMIS).”

The news correspondents obtained a quote from the research from the Queen Mary University of London, “These shocks represent the additional linguistic information in the Minutes beyond the Statements for the same FOMC meetings. This paper investigates the causal impact of the constructed shocks on market expectations, using 1-minute bar data on U.S. Treasury futures and a high-frequency event study approach. The key finding is that the PLMIS conditional on dovish text has a positive causal effect on price changes within the 30-minute event window. This overall positive impact can be decomposed into two opposing effects, each driven by a distinct type of topical content: ‘views on the recent economy’ and ‘forward guidance.”

According to the news reporters, the research concluded: “The main findings remain robust when the prompts are rephrased, a narrower event window is used, and an equal-weighted index is applied.”

This research has been peer-reviewed.

For more information on this research see: Decoding Central Bank Communications With Large Language Models. Journal of International Financial Markets Institutions & Money, 2026;109. Journal of International Financial Markets Institutions & Money can be contacted at: Elsevier, Radarweg 29, 1043 Nx Amsterdam, Netherlands.

Our news journalists report that additional information may be obtained by contacting Kairan Chen, Queen Mary University of London, School of Business and Management, London E1 4NS, United Kingdom. Additional authors for this research include Brigitte Granville and Roman Matousek.

The direct object identifier (DOI) for that additional information is: https://doi.org/10.1016/j.intfin.2026.102325. This DOI is a link to an online electronic document that is either free or for purchase, and can be your direct source for a journal article and its citation.

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