How Much Would China’s GDP Respond to a Slowdown in Housing Activity?

By Thomas R. Cook , Jun Nie and Aaron Smalter Hall
September 12, 2018 | The Macro Bulletin
China’s GDP has become more sensitive to declines in real estate activity and housing-related construction.

Auto Loan Delinquency Rates Are Rising, but Mostly among Subprime Borrowers

By Jason P. Brown and Colton Tousey
August 15, 2018 | The Macro Bulletin
Although auto debt and delinquency rates have increased over the past few years, the credit quality of auto debt has actually improved.

Understanding Hawks and Doves

By George A. Kahn and Amy Oksol
June 27, 2018 | The Macro Bulletin
Hawks in the FOMC project higher inflation than doves even though their projections assume a tighter path for monetary policy.

Nominal Wage Rigidities and the Future Path of Wage Growth

By José Mustre-del-Río and Emily Pollard
May 10, 2018 | The Macro Bulletin
Wage growth may remain subdued in the near future, in line with a high share of workers whose wages have not changed.

Why Has Inflation Persistence Declined?

By Takushi Kurozumi and Willem Van Zandweghe
April 11, 2018 | The Macro Bulletin
Inflation persistence fell in the 1980s due to the lower trend inflation rate that the Volcker disinflation produced.

What Could Resurging U.S. Energy Production Mean for the U.S. Trade Deficit?

By Nida Cakir Melek and Jun Nie
March 07, 2018 | The Macro Bulletin
Resurging energy production and booming energy exports could help reduce the U.S. trade deficit by 5 percent by the end of 2018.

Did Communicating a Numerical Inflation Target Anchor U.S. Inflation Expectations?

By Brent Bundick and A. Lee Smith
January 17, 2018 | The Macro Bulletin
Expectations for long-run inflation became better anchored after the Federal Open Market Committee adopted its 2 percent target.

Pent-Up Demand and Continuing Price Increases: The Outlook for Housing in 2018

By Jordan Rappaport
January 10, 2018 | The Macro Bulletin
Housing construction is struggling to meet pent-up demand, suggesting rents and home prices will continue to rise in 2018.

Characterizing the 2014–16 Slowdown in Investment

By Andrew Foerster
December 20, 2017

The investment sector experienced an unusual, isolated recession during 2014–16, a period when the overall economy was in an expansion.

A New Estimate of the Natural Rate of Unemployment

By Didem Tuzemen
November 29, 2017
A new estimate of the natural rate of unemployment suggests demographic and technical changes lowered the natural rate to 4.6 percent.

Changing Credit Profile of Consumers: Aging Versus the Business Cycle

By Taeyoung Doh
August 30, 2017
The average consumer credit score reached a record high recently, due in large part to an aging population.

Examining the Recent Shift in State and Local Pension Plans to Alternative Investments

By Huixin Bi and Trenton Herriford
August 30, 2017
State and local pension plans are increasingly turning to alternative investments, but underfunding only partially explains this shift.

Has China’s Growth Reached a Turning Point?

By Jun Nie and Yandong Jia
August 30, 2017
A new measure of Chinese economic activity shows its momentum increased in the first half of the year; however, this momentum may not be sustainable.

Subsiding Headwinds from the Strong Dollar: Evidence from Producer Prices along the Supply Chain

By George A. Kahn and Nicholas Sly
July 13, 2017
The foreign exchange value of the U.S. dollar has stabilized, and producer prices are rising, especially at early stages of the supply chain.

Does the Recent Decline in Household Longer-Term Inflation Expectations Signal a Loss of Confidence in the FOMC?

By Brent Bundick, A. Lee Smith, Trenton Herriford and Emily Pollard
June 21, 2017
Households have lowered their longer-term inflation outlooks, but they appear confident in the FOMC’s ability to achieve stable prices.

Forecasting the Stance of Monetary Policy under Balance Sheet Adjustments

By A. Lee Smith
May 10, 2017
Changes in the Federal Reserve’s balance sheet only modestly substitute for changes in the federal funds rate.

Waiting for a Pickup: GDP and the Sharing Economy

By Michael Redmond
April 19, 2017
Current measures of GDP may understate the contributions from ridesharing platforms and other dimensions of the sharing economy—a small but growing oversight for the national accounts.

The Large Unmet Demand for Housing

By Jordan Rappaport
April 12, 2017
A limited supply of housing available for sale or rent is significantly dampening household formation.

Wage Leaders and Laggards: Decomposing the Growth in Average Hourly Earnings

By Willem Van Zandweghe
February 15, 2017
Wage growth has accelerated gradually over the past two years, but only a few industries have driven the trend.

Stuck in Part-Time Employment

By Jonathan L. Willis
January 18, 2017
Although the share of workers employed part time for economic reasons has declined, it is unlikely to return to its pre-recession level in the near future.

Consumer Price Inflation and Rising Rents in the West

By Jordan Rappaport and Michael Redmond
December 19, 2016
Rising home rents in four western metros have increasingly boosted consumer price inflation.

How Does a Rise in International Shipping Costs Affect U.S. Inflation?

By Nicholas Sly , A. Lee Smith, Trenton Herriford and Elizabeth M. Johnson
December 01, 2016
Trenton Herriford, Elizabeth M. Johnson, Nicholas Sly, and A. Lee Smith find that an increase in ocean shipping costs leads to a modest boost in core inflation after one year.

What is Behind the Recent Increase in Labor Force Participation?

By Didem Tuzemen and Jonathan L. Willis
November 14, 2016
Didem Tüzemen and Jonathan L. Willis find that the recent increase in labor force participation is due not to more workers entering the labor force, but to fewer workers exiting it.

The Weak Outlook for Residential Investment

By Jordan Rappaport
October 06, 2016
Jordan Rappaport suggests supply-side factors will continue to constrain single-family home construction and sales into 2017.

Global Uncertainty in the Wake of Brexit

By Craig S. Hakkio and Nicholas Sly
September 12, 2016
Craig S. Hakkio and Nicholas Sly find that increased global uncertainty after Brexit will be a major concern for the United Kingdom, a modest concern for the euro area, and a minor concern for the United States. 

Tracking Consumer Credit Trends

By Troy Davig and William Xu
August 23, 2016
Troy Davig and William Xu find that a larger share of consumers with low credit scores are increasing their debt than those with high credit scores.

The Drag of Energy and Manufacturing on Productivity Growth

By Willem Van Zandweghe
April 18, 2016
Willem Van Zandweghe finds a decline in manufacturing and mining activity has slowed overall productivity growth.

Monetary Policy at the Zero Lower Bound: Revelations from the Summary of Economic Projections

By George A. Kahn and Andrew Palmer
April 06, 2017
George A. Kahn and Andrew Palmer assess how FOMC participants' projections that policy would lift off from its effective lower bound related to their projections for inflation and unemployment.

Flowing into Employment: Implications for the Participation Rate

By José Mustre-del-Río, William Xu and Michael Redmond
April 01, 2016
José Mustre-del-Río, Michael Redmond, and William Xu find more prime-age individuals are flowing into employment from outside the labor force, though effects on the participation rate could be limited by educational attainment.

The Lasting Damage from the Financial Crisis to U.S. Productivity

By Willem Van Zandweghe and Michael Redmond
March 29, 2016
Michael Redmond and Willem Van Zandweghe find that tight credit conditions during the 2007–09 financial crisis dampened productivity, leaving it on a lower trajectory. 

The Limited Supply of Homes

By Jordan Rappaport
March 23, 2016
Jordan Rappaport finds that a limited supply of single-family homes will continue to constrain home sales and put upward pressure on home prices over the next few years.

The Reallocation of Energy-Sector Workers after Oil Price Booms and Busts

By Jason P. Brown and Andres Kodaka
March 03, 2016
Jason P. Brown and Andres Kodaka compare recent job losses in the mining sector with those that occurred during the Great Recession and find displaced workers had an easier time finding new jobs in 2015 than they did during the recession.

Gauging the Strength of Chinese GDP Growth

By Jun Nie
February 29, 2016
Jun Nie constructs an alternative measure to evaluate the strength of Chinese GDP growth and identifies potential risks to China’s growth in the near term.

How Much of the Fall in Inflation Can Be Explained by Energy and Import Prices?

By A. Lee Smith
January 15, 2016
A. Lee Smith finds that recent declines in inflation may be due to historically large movements in oil prices and the foreign exchange value of the dollar. 

Estimating the Monetary Policy Rule Perceived by Forecasters

By Brent Bundick Brent Bundick examines whether the FOMC’s implicit monetary policy rule, as perceived by professional forecasters, changed when the federal funds rate reached its effective lower bound.

Long-Term Survey-Based Inflation Expectations Have Become Better Anchored

October 06, 2015

By Craig S. Hakkio
Craig S. Hakkio finds that while the median of some long-term inflation forecasts has declined, the distribution of individual forecasts suggests long-term inflation expectations have in fact become better anchored.

Evaluating a Year of Oil Price Volatility

September 08, 2015

By Troy DavigNida Çakır MelekJun NieA. Lee Smith, and Didem Tüzemen 
Troy Davig, Nida Çakır Melek, Jun Nie, Lee Smith, and Didem Tüzemen find changes in expectations of future oil supply relative to demand are the main drivers of the recent oil price decline. 

Global Capital Flows from China

By Jun Nie and Nicholas Sly
Jun Nie and Nicholas Sly examine recent trends in capital flows from China and the implications for the United States.

Has Forward Guidance Been Effective?

By A. Lee Smith and Thealexa Becker
A. Lee Smith and Thealexa Becker compare forward guidance announcements with changes in the effective federal funds rate and find the two policy measures have had similar macroeconomic effects.

Monetary Policy and Firm Entry and Exit

By Yoonsoo Lee and Willem Van Zandweghe 
Yoonsoo Lee and Willem Van Zandweghe find unusually accommodative monetary policy reduces the reallocation of capital and workers from exiting firms to new ones, potentially slowing productivity growth.

Taylor Rules or Target Rules?

By George A. Kahn
George A. Kahn assesses whether the Federal Open Market Committee's policy actions are better characterized as following a policy-rule or target-rule approach.

Do Monetary Policy Shocks Affect Trend Labor Productivity?

By Willem Van Zandweghe 
Willem Van Zandweghe examines whether monetary policy has had long-lasting effects on labor productivity and potential output.

The Effect of the U.S. Energy Boom on the Trade Deficit

By Craig S. Hakkio and Jun Nie
Craig S. Hakkio and Jun Nie predict the real energy trade deficit will decline at a much slower pace in 2015 than in the past few years.

Has the U.S. Economy Become Less Interest Rate Sensitive?

July 08, 2015

By Jonathan L. Willis and Guangye Cao
Jonathan L. Willis and Guangye Cao investigate shifts in the economy’s sensitivity to interest rates by examining how total employment responds to changes in monetary policy. 

Millennials, Baby Boomers, and Rebounding Multifamily Home Construction

June 23, 2015

By Jordan Rappaport
Jordan Rappaport analyzes the forces driving the recent rebound in multifamily construction.

Confident about Quitting: Job Leavers and Labor Market Optimism

By José Mustre-del-Río and William Xu
Mustre-del-Río and Xu compare two measures of voluntary turnover and find job quitters have recently become more optimistic about their employment opportunities.

Opportunity Knocks: Improved Matching of Jobs and Workers

May 13, 2015

By Didem Tüzemen and Jonathan L. Willis
Tüzemen and Willis illustrate that over the past year, workers found jobs more closely matched to their educational attainment. 

What Could Lower Prices Mean for U.S. Oil Production?

By Nida Cakir Melek
Melek estimates the effects of the recent oil price decline on 2015 oil production.

Are Longer-Term Inflation Expectations Stable?

March 09, 2015

By Brent Bundick and Craig S. Hakkio
The authors use survey data to evaluate the stability of forecasters' long-term inflation expectations.

Should Monetary Policy Monitor Risk Premiums in Financial Markets?

By Taeyoung Doh, Guangye Cao and Daniel Molling
The authors examine whether risk premiums can predict future economic growth and whether monetary policy can influence risk premiums. 

Consumer Debt Dynamics: An Update

By John Carter Braxton and Troy Davig
Is the trend of contracting of consumer debt turning? Outstanding consumer debt and the fraction of consumers with increasing debt grew in the last half of 2013, mainly fueled by those with low credit scores borrowing to buy autos.

The Global Impact of U.S. Monetary Policy

By Travis Berge and Guangye Cao
Travis Berge and Guangye Cao assess the effects of U.S. monetary policy on asset prices in 50 countries. They find a similar reaction of asset prices to conventional and unconventional monetary policies.

Evolving Market Perceptions of Federal Reserve Policy Objectives

By George A. Kahn and Lisa Taylor
Despite varying interpretations of the Fed's monetary policy mandate, the response of long-term rates to economic news remains relatively stable, suggesting markets perceive little change in policy objectives under different regimes.

Tight Credit Conditions Continue to Constrain the Housing Recovery

By Jordan Rappaport and Paul Willen
The housing recovery has continued to struggle to gain traction. The vigilance with which lenders have been applying stricter lending standards suggests regulatory uncertainty may be playing a role.

Evaluating Monetary Policy at the Zero Lower Bound

By Craig S. Hakkio and George A. Kahn
Craig S. Hakkio and George A. Kahn compare a "shadow" federal funds rate to prescriptions from an estimated policy rule and find policy was not sufficiently accommodative after the recession but became more accommodative over time.

The Wage Cycle and Shadow Labor Supply

By Troy Davig and José Mustre-del-Río
Troy Davig and José Mustre-del-Río evaluate current wage growth and find wages are not only rising at a pace consistent with the last expansion, but likely to rise further as the labor market improves.

China's Slowing Housing Market and GDP Growth

By Jun Nie and Guangye Cao
In The Macro Bulletin, Jun Nie and Guangye Cao examine the slowdown in China's real estate sector and suggest additional policy stimulus may be needed to meet the country's 2014 target for GDP growth.

Kansas City Fed's Labor Market Conditions Indicators (LMCI)

By Jonathan L. Willis and Craig S. Hakkio
In The Macro Bulletin, Craig S. Hakkio and Jonathan L. Willis update the Kansas City Fed’s Labor Market Conditions Indicators and assess labor market improvements and momentum.

The Asymmetric Effects of Uncertainty on Employment

September 04, 2014

By Andrew Forester
Foerster examines three periods of heightened stock market volatility during the economic recovery to find uncertainty may have slowed employment growth.

Does Health Care Reform Support Self-Employment?

September 24, 2014

By Didem Tuzemen and Thealexa Becker
Tüzemen and Becker study the Massachusetts Health Care Reform Act and find the reform may have supported self-employment in the state.

Accounting for Changes in the U.S. Budget Deficit

By Troy Davig and Michael Redmond
Davig and Redmond gauge the contributions of three factors to the declining U.S. federal budget deficit.

Following the Leaders: Wage Growth of Job Switchers

By José Mustre-del-Río
In The Macro Bulletin, José Mustre-del-Río analyzes labor market conditions to find increasing competitive pressures have led to strong wage growth for job switchers.

Assessing Labor Market Conditions: The level of activity and the speed of improvement

By Craig S. Hakkio and Jonathan L. Willis
To help assess labor market conditions, two measures are proposed that show that the pace of improvement has recently increased, but two more years of similar improvement are needed to return conditions to historical averages.

The Shadow Labor Supply and Its Implications for the Unemployment Rate

By Troy Davig and José Mustre-del-Río
The number of people wanting work, but not looking for a job, has swelled in recent years. However, their flow rate back into unemployment has been declining, so they will likely only have a modest impact on the unemployment rate.

Has The Effect of Monetary Policy Announcements On Asset Prices Changed?

By Taeyoung Doh and Michael Connolly
The Federal Reserve has increased communication about the future path of the federal funds target rate over time. The use of forward guidance as a policy tool has raised questions about changes in how it influences the economy.

U.S. Exports and Foreign Economic Growth: Which Regions Matter Most?

By Jun Nie and Lisa Taylor
U.S. export growth tends to vary with changes in different foreign regions' economic growth rates. This article estimates how much change in U.S. export growth may be associated with a rise or fall in a given region's GDP growth.

The Weakened Influence of Low Interest Rates on Durable Goods Spending

By Willem Van Zandweghe and John Carter Braxton
Despite record-low interest rates, the pace of the current economic recovery has been only moderate. One reason is that the positive impact of lowered interest rates on consumer purchases of durable goods has diminished.

The Impact of an Aging Population on State Tax Revenues

By Alison Felix and Kate Watkins
People tend to earn less and spend less when they retire. As the baby boom generation retires, the aging of the U.S. population will likely reduce state governments’ revenue per capita from income taxes and sales taxes significantly.

The Long-Term Outlook for U.S. Residential Construction

By Jordan Rappaport
The recovery of U.S. housing construction paused during the first half of 2013. Stronger growth is likely to resume in the near term. But over the long term, home construction is likely to contract as aging baby boomers downsize.