ECB looks to leverage AI to better understand inflation after big misses

The European Central Bank is looking at how artificial intelligence could help improve its understanding of inflation after underestimating price pressures for years and delaying the start of the most aggressive policy tightening in its history.

Joining the masses of firms already using AI, the ECB is now exploring ways to process and analyse millions of data points, including public price data, corporate statistics, news articles and bank supervisory documents to produce better analysis for policy decisions.

“AI offers new ways for us to collect, clean, analyse and interpret this wealth of available data, so that the insights can feed into the work of areas like statistics, risk management,