FRANKFURT, Germany–The European Central Bank said it is now exploring ways to use artificial intelligence to better understand inflation and to support its regulation of big banks.
The ECB emphasized, however, its AI-related efforts are in the early stages.
The ECB is looking into how it can use large language models, similar to ChatGPT, for various purposes, according to Myriam Moufakkir, the bank’s chief services officer, who shared the update in a blog post.
Preparing Summaries
“This includes preparing summaries and briefings that could be used to assist policy and decision-making; making the bank’s public statements easier to understand; and analyzing and comparing documents provided by banks,” the New York Times reported.
The ECB said it already uses machine translations to communicate in many languages with people across the eurozone. The bank is assessing the use of artificial intelligence in nine projects.
“We will continue to investigate the possibilities and challenges of using AI,” Moufakkir wrote. Those examples “are only the tip of the iceberg” of possible uses, according to the Times report.
‘New Ways to Collect Data’
Artificial intelligence provides “new ways for us to collect, clean, analyze and interpret” that information, Moufakkir wrote.
“As an example, AI can help automate the time-consuming process of sorting data needed for economic analysis,” the New York Times stated in its analysis. “Insights from A.I. could feed into analysis for monetary policy, but decisions, such as on interest rates, rest ‘in the hands of humans,’ that is, the members of its governing council, the bank later explained.”
The report added that AI can also be used to help the central bank better understand inflation, according to the blog post.
Risk Management Tool
AI can be very useful for central banks in certain areas such as risk management, where there’s a lot of data and relatively simple repeated actions or decisions, Jon Danielsson, a co-director of the Systemic Risk Center at the London School of Economics, told the Times, adding he expects AI to be increasingly used in routine economic analysis.
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