The Bank for International Settlements (BIS) Innovation Hub has launched Project Spectrum to explore how generative artificial intelligence can automatically categorise billions of product descriptions and price observations to improve inflation nowcasting. The initiative is being run by the BIS Innovation Hub Eurosystem Centre with the European Central Bank and the Deutsche Bundesbank. Project Spectrum will use the European Central Bank’s Daily Price Dataset, learnings from the Eurosystem Centre’s Project Gaia, and the multilingual capabilities of large language models to convert raw, high-volume price data into structured information. Initial experiments focus on mapping observations to globally standardised household expenditure categories, including the United Nations’ Classification of Individual Consumption According to Purpose (COICOP). The BIS notes that the approach could be applicable beyond Europe because the training data covers global retail chains and multiple European languages, and the techniques are intended to be extensible to languages not included in the training set.
Bank for International Settlements - Innovation Hub 2025-02-10
Bank for International Settlements Innovation Hub launches Project Spectrum to use generative AI for inflation nowcasting
The Bank for International Settlements Innovation Hub has launched Project Spectrum to use generative AI for categorizing product descriptions and price observations to enhance inflation nowcasting, in collaboration with the European Central Bank and Deutsche Bundesbank. The project utilizes the European Central Bank’s Daily Price Dataset and aims to map data to standardized expenditure categories, with potential applicability beyond Europe.