Reports

“Our survey approach allowed us to measure passthrough in three complementary ways: based on reported backward-looking growth in costs and prices; based on expected forward-looking growth in costs and prices; and via a hypothetical scenario posed to business contacts, which allowed us to effectively shock respondents’ cost[1]growth expectations by a common amount and measure how…

“Total nonfarm payroll employment increased by 339,000 in May, and the unemployment rate rose by 0.3 percentage point to 3.7 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in professional and business services, government, health care, construction, transportation and warehousing, and social assistance.” “The unemployment rate increased by 0.3 percentage point…

“The researchers demonstrate, using bank-level data, that increases in banks’ central bank reserves during QE were associated with increases in the volume of demand deposits and credit lines. In contrast, they do not find that the banks that provided customers with more claims on liquidity during QE reduced those claims when QT kicked in. This…

“Taken together, the evidence presented here suggests that the relationship between initial UI claims and Google Trends has continued to hold post-pandemic. What does this imply for the current situation in which initial UI claims have increased but the Google Trends unemployment topic has not? While the two measures of labor market health do not…

“S&L government expenditures represent a significant portion of aggregate GDP and fulfill an essential role in the provision of public goods and services. S&L government spending is often thought to be procyclical and recover only sluggishly following recessions. We docu­ment that this pattern did not systematically emerge until the mid- 1980s. In discussing possible explanations…

“The CRE office sector is substantial, with an estimated value of $3.2 trillion.17 Should firms reduce their office space requirements to reflect the reality of employees’ WFH preference, the CRE office sector could suffer a contraction, posing a risk to financial institutions that hold loans or CMBS secured by office properties. In fact, should offices contract…

“Since early 2022, the Federal Open Market Committee has increased the target range for the federal funds rate from 0%-0.25% to 5%-5.25%. The higher fed funds rate has driven up interest rates on financial instruments (e.g., Treasury bonds, certificates of deposit and corporate bonds) and loans. Perhaps most notably for everyday households, the 30-year fixed-rate…

“Our results indicate that news signals derived from central bank speeches can help explain volatility and tail risk in both equity and bond markets. Speech-implied news seem to carry information to which markets react – particularly in abnormal GDP and inflation regimes. We find no evidence that speeches resolve uncertainty. These findings underpin the importance…

“While offices face plenty of challenges over the coming year, the risks to the sector and to bank lenders in general don’t appear widespread at this stage. Nevertheless, bank regulators seem to be keeping a close eye on these developments, mindful of past crises where real estate was at the center. In a March 6…