We explore whether the tone of central bank communication matters for asset prices. Using press conference statements by the ECB, which was the first central bank to establish regular live press conference after meetings of its Governing Council, we find that tone changes have a statistically and economically significant effect on equity returns. Stock prices increase when ECB tone becomes more positive and vice versa. The return differential associated with positive versus negative tone changes is around 60 basis points on press conference days and increases to more than 100 basis points until the next press conference. Moreover, we find that positive tone changes are associated with increases in the level and hump of the government yield curve and with lower implied equity volatility. Since we also show that tone changes are unrelated to current and future economic fundamentals, our results suggest that central bank tone matters for asset prices through a risk-based channel.