Reports

Economic Conditions “In their discussion of current economic conditions, participants noted that recent indicators pointed to modest growth in spending and production. Nonetheless, job gains had been robust in recent months, and the unemployment rate remained low. Inflation had eased some-what but remained elevated … Against this back-ground, participants continued to be highly attentive to…

“Since reaching the debt limit in January 2023, the U.S. Treasury has used extraordinary measures to fund the government. However, the Treasury estimates those measures will be exhausted later this year. To gauge possible effects, we review economic and financial market outcomes during previous debt limit episodes. In each case, these episodes led to increased…

“Shelter costs play an important role in price indexes. Therefore, to understand how inflation will move, it is important to consider how the price of shelter will evolve. At this moment particularly, there is uncertainty about the movement of the price of shelter. Rental prices have increased significantly in the last two years, but their…

“The normalization process of the Fed’s balance sheet is ongoing. Current plans for monetary policy implementation interact with this process. In particular, normalization is aimed at ultimately providing a minimum level of “ample” reserves. The timing for when that level of reserves will be reached depends on multiple factors. Based on assumptions reflecting current expectations…

“Inflationary pressures—their determinants and evolution—continue to dominate policy discussions. In this post, we provide a simple framework to analyze the determinants of different measures of inflation and use it to lay out a risk-scenario analysis. We find that global supply factors captured by the New York Fed’s Global Supply Chain Pressure Index (GSCPI) are strongly associated with…

“The tanker traffic data indicate that the impact of the crude oil embargo on oil prices and on the global economy is likely to be fairly benign in 2023, absent a strong surge in demand. The fact that the $60 price cap on Russian crude—imposed in December 2022 as part of the trade sanction regime—was too high to be…

“Inflation targeting has become the dominant way countries approach setting monetary policy goals. However, central banks differ in how they conduct that policy and how they evaluate their success in meeting a stated inflation goal. A new assessment method combines a percentage range around a target, known as an inflation tolerance band, with central banks…

“In a January 2022 post, we first presented the Global Supply Chain Pressure Index (GSCPI), a parsimonious global measure designed to capture supply chain disruptions using a range of indicators. The spirit of our index was to isolate supply factors, such as shutdowns in response to the pandemic, that put pressure on the global supply chain.…

“Speaking at the Federal Reserve Bank of Chicago’s 2023 Automotive Insights Symposium, held at the Bank’s Detroit branch in January, Chicago Fed policy advisor and automotive industry expert Kristin Dziczek shared her thoughts on what will shape the sector in the coming year. These seven key points are derived from that talk, entitled “An Economic…

“The surge in home prices that followed the onset of the COVID-19 pandemic and the sharp increase in interest rates during 2022 have driven up the cost of purchasing a home. Although purchase demand has contracted and sales of single-family homes have plummeted, home prices have declined only modestly, leading many prospective homeowners to question…