Introducing Fed Sentiment: A Weekly Index of Market Tone Toward US Monetary Policy
Investors watch the Fed obsessively, but there has never been a clean, single number that summarizes how the market is talking about it. Fed Sentiment is a weekly composite index that does exactly that: aggregated tone across the current Fed Chair, the Federal Reserve as an institution, and the former Chair as a retrospective signal.
If you trade equities, rates, or anything that moves with the macro, you already know how much weight the market puts on Fed signaling. A single sentence in a Powell press conference can move trillions in market cap. A Jackson Hole speech reshapes the curve for a quarter. And yet, when you sit down to actually measure how the market is feeling about the Fed in any given week, there is no clean number for it. You read the news, scroll some posts, watch the futures-implied path, and form a vibe.
We have spent the last year teaching our pipeline to read financial text for tone. Today we are pointing that same machinery at the Federal Reserve itself, and publishing the result as a weekly composite index: Fed Sentiment.
It lives at app.sentisense.ai/indexes/fed-sentiment.
What Fed Sentiment measures
Fed Sentiment is a single weekly value, scaled from minus 100 (uniformly negative tone) to plus 100 (uniformly positive tone), with most weekly readings sitting in the plus or minus 25 band. It captures how news and social commentary spoke about US monetary policy authority during the prior Monday to Sunday window.
It is not a directional bet on the market. It is not a guess at what the Fed will do next. It is a measurement of the tone of the conversation that happened around the Fed in the past week. Some weeks that conversation is constructive (post a well-received press conference, after a clearer dot plot). Some weeks it is sharply negative (a hawkish surprise into a fragile tape, a credibility wobble, a political headline). The index gives you a quick read on which week you are in.
How the basket is built
A "Fed Sentiment" index needs to make a choice about what counts as "the Fed." We treat it as three weighted constituents:
| Constituent | Weight | Why |
|---|---|---|
| Current Fed Chair (Kevin Warsh as of this writing) | 3.0 | The Chair is the dominant signaling voice; the largest share of the basket. |
| The Federal Reserve as an institution | 1.0 | Captures discussion of the FOMC, the dot plot, regional Fed banks, and the central bank as an entity rather than a person. |
| Former Chair (Jerome Powell) | 0.5 | A retrospective signal; the prior Chair is still cited in market commentary and provides a baseline drift for the recent past. |
The weights are intentionally tilted heavily toward the current Chair. The market reacts to who is in the chair now; the institutional voice provides ballast; the former Chair provides continuity across transitions so the chart does not get a discontinuity every time leadership changes.
For each weekly bucket, we read the past seven days of news and social conversation that mentions each constituent, score the tone of each individual mention, and compute a tone score for that constituent over the week. Buckets with fewer than ten mentions for a given constituent are flagged as thin data and excluded from the composite for that week to avoid noise. Constituents with stale or excluded coverage are clearly labeled in the breakdown on the index page.
The composite is a straightforward weighted average across the constituents that had enough data that week.
A few honest notes on the methodology
We could write a paper here, but a launch post is not the place. A few things worth saying out loud:
- The signal is weekly, not real time. The pipeline batches mentions over a Monday-to-Sunday window and produces one reading per week. Daily noise is intentionally smoothed out; the index is designed to track tone shifts, not intraday reactions.
- Tone is not direction. A positive reading does not mean "buy stocks." It means the conversation about Fed policy was constructive that week. Whether that is bullish or bearish for any specific asset is a question this index does not answer.
- Coverage is a real input. When a constituent gets very little press in a given week (recess weeks, off-cycle weeks), we exclude them from that week's basket rather than carry forward stale signal. The index page shows you exactly which constituents contributed each week.
- The aggregation is transparent by design. Mean tone across mentions, weighted average across constituents, with no opaque weighting you cannot reason about. The index page shows each constituent's contribution and coverage, so you can see exactly how the weekly number is built.
How to read the chart
The index page shows the latest weekly value with a polarity label (positive, mildly positive, neutral, mildly negative, negative), a 200-day weekly history line with a zero baseline, and a breakdown of each constituent's contribution including coverage and a staleness flag.
A few patterns worth watching:
- Tone vs price divergence. Weeks where Fed Sentiment shifts sharply while equities do not (or vice versa) tend to be the most interesting setups. The market does not always price tone in the same week it shifts.
- The institutional constituent as a steady hand. The "Federal Reserve as institution" line tends to move more slowly than either Chair line. When it moves, it is often a more structural shift.
- Coverage as a signal. Weeks where a constituent gets unusually high mention volume are often the weeks where something notable happened, regardless of the tone score itself.
For developers
Fed Sentiment is one of several proprietary indexes the SentiSense pipeline produces. The full set, including Market Mood, is being added to the public API so that builders can pull the index into their own dashboards, agents, and research tools.
GET /api/v1/indexes/fed-sentiment
GET /api/v1/indexes/fed-sentiment/history?days=200
Free tier includes 1,000 API requests per month, which is comfortably more than enough to poll a weekly index. The SentiSense API skill covers the full surface for AI agents using OpenClaw, Claude Code, or Cursor.
Try it now
The Fed Sentiment Index is live on the Indexes page. No sign-up required for the read-only view.
SentiSense provides market information and sentiment analysis for informational purposes only. Fed Sentiment and all proprietary indexes are derived from AI-analyzed news and social data and should not be relied upon for investment decisions. This index measures tone in financial commentary; it is not a prediction of monetary policy actions, market direction, or asset prices. Always consult a licensed financial advisor before making investment decisions.
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