Reports

“In CBO’s view, the euro and the renminbi are the two currencies most likely to displace the dollar as the primary international currency, but neither is likely to overtake the dollar over the coming decade.55 The main obstacle for the euro is that the euro zone’s economic importance in the global economy (relative to the…

“The Economic Commentary highlights three results. First, trend PCE inflation started rising noticeably in 2020, and since the beginning of 2021 trend PCE inflation is measured to be above the historical average of PCE inflation of 3.3 percent (above the long-term inflation target of 2 percent). Second, the Phillips curve slope has moderately increased, implying…

“We conclude that there is significant heterogeneity in shipping costs across both countries and industries. These findings suggest that changes in international shipping costs following large shocks such as COVID-19 have likely had heterogeneous impacts across import sources and industries: The unprecedented surge of shipping costs has likely had a greater impact on imports from…

“Although banks retain a special role in the financial system, which dates back to the 19th century, the crisis of 1772 demonstrates that a sophisticated financial system can thrive and fail without banks. Asset cycles, gambling for resurrection, moral hazard and too-big-to-fail issues persist in a world with or without banks. As happened with the rescue of large…

“Overall, results suggest that banks partly mask risk in supervisory audits, notably on liquid securities that are easier to trade (different from credit), with not only short-term spillovers on asset prices and credit supply, but also with medium-term implications for the real economy (corporate real effects). The results hold important implications for policy. In particular,…

“There is no one-size-fits-all approach to inflation hedging; the optimal hedge depends on the particular types of prices that an investor is exposed to and at which horizons. Over the last twenty years, we find that commodities and commodity-related stocks and currencies are generally successful in hedging headline consumer inflation, but this mostly seems to…

“GDP growth was solid in Q4. Consumption and inventories were substantial contributors to growth. Residential investment spending was a large drag on growth, while private nonresidential investment spending was flat.” “Consumer spending in the first two months of Q1 was up substantially over the Q4 average. Real disposable income was also up sharply. Manufacturing activity has…

“The incentives that drive bank runs have been well understood since the seminal work of Nobel laureates Douglas Diamond and Philip Dybvig (1983). When a bank is suspected to be insolvent, early withdrawers can get the full value of their deposits. If and when the bank runs out of funds, however, the bank cannot pay remaining depositors.…

“Factors Affecting Reserve Balances of Depository Institutions and Condition Statement of Federal Reserve Banks.” “The release presents a balance sheet for each Federal Reserve Bank, a consolidated balance sheet for all 12 Reserve Banks, an associated statement that lists the factors affecting reserve balances of depository institutions, and several other tables presenting information on the…

“Child care is critical to the nation’s workforce. Yet access to high-quality care is inequitable, and the cost, especially for licensed child care, is steep for many families. Additionally, many parents simply cannot find child care that meets their needs, limiting their ability to work. When the child care sector does not fully meet the…