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Timely economic data curated by research staff at the Federal Reserve Bank of Kansas City. Click the link button in the chart title to copy and share.

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CtE26-Brown

Higher Fuel Prices Point Toward Higher One-Year-Ahead Inflation Expectations

Charting the Economy | Energy | Inflation
CtE26-McCoy2

Improving Labor Force Participation Among Gen Z Is Partially Offsetting Baby Boomer Retirements

Charting the Economy | Labor and Demographics
CtE26-McCoy

In Recent Years, an Increased Share of Tenth District Firms Report Absorbing Higher Input Costs

Charting the Economy | Data and Trends | Inflation | Manufacturing | Regional
CtE26-MatschkedeVyver

The Rising Popularity of Stablecoins Could Reinforce the Global Role of the U.S. Dollar

Charting the Economy | Banking and Finance | International
CtE26-HirnerMustre-del-Rio

Credit Card Delinquencies Are Becoming More Widespread Across the U.S. Population

Charting the Economy | Banking and Finance | Macroeconomics | Monetary Policy | Payments
CtE26-FelixKiceRappaport2

Manufacturers Resisted Laying off Workers as Backlogs Fell; Now They May Be Slow to Increase Employment as Backlogs Rise

Charting the Economy | Labor and Demographics | Manufacturing | Regional
CtE26-GloverOliyide

According to the Taylor Rule, the Federal Funds Rate Should Probably Be Higher—By How Much Is Uncertain

Charting the Economy | Inflation | Macroeconomics | Monetary Policy
CtE26-FelixKiceRappaport

Over Half of Surveyed Firms Report Decreased Profit Margins This Year, as Most Absorbed a Portion of Higher Input Costs

Charting the Economy | Inflation | Manufacturing | Regional
CtE26-BiVasiljevicYang

Employment in AI-Intensive Sectors Is Growing More Slowly

Charting the Economy | AI | Labor and Demographics | Macroeconomics
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Higher Fuel Prices Point Toward Higher One-Year-Ahead Inflation Expectations

By Jason P. Brown

The chart shows that the correlation between U.S. gasoline and diesel prices and one-year-ahead inflation expectations was positive from 1995 through 2024, rising from roughly 0.2 to 0.3 in 1995 to 2004 to 0.8 in 2015 to 2024. In 2025, the correlation turned negative, falling to around -0.3 for gasoline and -0.5 for diesel. In 2026, the correlation returned to positive territory, rising to roughly 0.7 for both gasoline and diesel.

Notes: Chart shows the correlation between monthly average retail gasoline and diesel prices with one-year-ahead inflation expectations by period. Data for 2026 covers January through August.

Sources: U.S. Energy Information Administration and University of Michigan (both accessed via Haver Analytics).

Historically, fuel prices and one-year-ahead inflation expectations have moved together, with this positive correlation reaching roughly 0.8 between 2015 and 2024. In 2025, tariff concerns temporarily inverted that relationship, as inflation expectations rose even as fuel prices fell. Through the first eight months of 2026, the correlation has snapped back to around 0.7. This resurgence coincides with a sharp rise in fuel costs: Retail gasoline and diesel prices are up more than 55 percent since the start of 2026, driven by supply disruptions in global oil and refined petroleum markets. With fuel prices still under upward pressure, one-year-ahead inflation expectations are likely to stay elevated over the coming year.

Charting the Economy Energy Inflation

Improving Labor Force Participation Among Gen Z Is Partially Offsetting Baby Boomer Retirements

By John McCoy

Labor force participation is displayed for generational cohorts, including the baby boomers, Generation X, millennials, and Gen Z. Baby boomer participation has fallen as the population has aged and retired, while Gen Z participation has generally lagged the rate of participation of older cohorts.

Notes: Numbers in parentheses refer to each generation’s share of 2026 labor force. The youngest members of Gen Z are not of working age and are excluded from the analysis. Data used to construct the chart are first available in 1976 and thus do not capture the first several years when the baby boom cohort was of working age. The labor force participation rate for each generation is the share of the cohort age 16 and older working or actively looking for work.

Sources: U.S. Bureau of Labor Statistics and author’s calculations.

Download the data file for this chart.

Labor force participation rates rise and then fall as individuals age. The light blue dashed line shows that participation among baby boomers increased until that generation reached their mid-50s and has recently fallen to 30 percent as most members have moved into retirement. This downward pressure on participation from the baby boomers is partly offset by increasing participation among Generation Z (solid green line). Gen Z initially had lower participation rates than older cohorts in their teens and twenties, but recently their participation has approached 60 percent. Gen Z’s participation is now similar to millennials’ at the same age, though millennials reached this age during a much weaker labor market in 2008–09.

Charting the Economy Labor and Demographics

In Recent Years, an Increased Share of Tenth District Firms Report Absorbing Higher Input Costs

By John McCoy

Between 2015 and 2019, the share of firms passing higher input costs along to customers was approximately equal to the share of firms absorbing higher input costs. In 2021, the total share of firms reporting higher input costs surged, as did the share passing those costs along. More recently, the share of firms absorbing higher costs has risen and remained higher than the share passing costs along.

Notes: Chart reflects responses to the Kansas City Fed’s Manufacturing and Services surveys, which collect information on activity in the Tenth Federal Reserve District. Firms “passing through input costs” are those where both input and output prices were higher than the previous month. Firms “absorbing input costs” are those where only input prices were higher than the previous month. The balance of firms does not report higher input prices.

Sources: Federal Reserve Bank of Kansas City and author’s calculations.

Download the data file for this chart.

Between 2015 and 2019, about 30 percent of firms reported higher input prices compared with the previous month, with about an equal share passing at least some of those costs along to customers (blue line) as absorbing the higher costs (purple line). In 2021 and 2022, indicative of the higher consumer price inflation at the time, a majority of firms passed at least some of higher input costs through to customers. Since 2023, the share of firms reporting higher input prices has increased, and a larger share of these firms are now absorbing these higher costs. The inability or hesitancy of firms to pass along higher input prices to customers more recently could compress profit margins, potentially requiring cost savings elsewhere.

Charting the Economy Data and Trends Inflation Manufacturing Regional

The Rising Popularity of Stablecoins Could Reinforce the Global Role of the U.S. Dollar

By Johannes Matschke and David deVyver

The trading volume of stablecoin USD Coin rose substantially from 2023 to 2026, a sign of stablecoins’ increasing popularity.

Note: Chart depicts the average daily trading volume of stablecoin USD Coin at monthly frequency in billions of U.S. dollars.

Source: CoinGecko (Haver Analytics).

Stablecoins have grown increasingly popular in recent years, as indicated by the growing trading volume of stablecoin USD Coin. One reason for the growth in stablecoin trading is that stablecoins can reduce payment frictions, particularly for cross-border transactions. In a paper presented at the Kansas City Fed’s 2026 Jackson Hole Economic Policy Symposium, Eswar Prasad, Gordon Liao, and Tony Zhang argue that because most stablecoins are backed by U.S. dollar-denominated assets, the increasing use of stablecoins for borrowing and lending may reinforce the dollar’s global dominance. However, they also highlight that stablecoins introduce risks if not fully backed by safe and liquid assets, which provide a credible backstop during financial market distress.
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Charting the Economy Banking and Finance International

Credit Card Delinquencies Are Becoming More Widespread Across the U.S. Population

By Molly E. Hirner and José Mustre-del-Río

Since 2023, both the share of the population with at least one severely delinquent (90+ days past due) credit card and the share of credit card balances that are severely delinquent have moved up. In contrast, during the Great Recession in 2007–09, the population measure was fairly constant, if not falling, while the balance measure rose sharply.

Notes: Delinquent debt is debt 90 days or more past due. The total population is defined as those with at least one credit card account. Data as of 2026:Q2. Gray bars denote National Bureau of Economic Research (NBER)-defined recessions.

Sources: Federal Reserve Bank of New York Consumer Credit Panel/Equifax Data, NBER (Haver Analytics), and authors’ calculations.

Since 2023, both the share of the U.S. population with at least one severely delinquent (90+ days past due) credit card (blue line) and the share of credit card balances that are severely delinquent (purple line) have moved up. In contrast, during the Great Recession in 2007–09, the population measure was fairly constant, if not falling, while the balance measure rose sharply. Although the balance measure is currently below its peak in 2010, severe delinquencies are now more widespread across the U.S. population than at any point in the past two decades.

Charting the Economy Banking and Finance Macroeconomics Monetary Policy Payments

Manufacturers Resisted Laying off Workers as Backlogs Fell; Now They May Be Slow to Increase Employment as Backlogs Rise

By Alison Felix, Max Kice and Jordan Rappaport

Since 2002, responses to the Kansas City Fed’s Manufacturing Survey show a close correlation between movements in their backlog of orders and their employment levels. However, from late 2022 to 2025, this relationship changed as many manufacturers reported flat employment levels even as their backlog of orders declined sharply. Although survey contacts have reported that their backlog of orders has increased in recent months, manufacturers may now be slower to increase employment.

Note: The diffusion indexes show the net percentage of firms reporting an increase in the backlog of orders and the net percentage reporting an increase in the number of employees.

Source: Federal Reserve Bank of Kansas City.

Manufacturers typically adjust their employment (purple line in the chart) in line with changes in their backlog of orders (blue line), as responses to the Kansas City Fed’s Manufacturing Survey highlight. From late 2022 to 2025, however, many manufacturers resisted laying off workers even as their backlog of orders fell sharply. One reason for such “labor hoarding” was the difficulty businesses had in attracting and retaining workers as the economy emerged from the pandemic. Consequently, manufacturers may now be slower to increase employment even as their backlog of orders increases, as contacts report it has in recent months.

Charting the Economy Labor and Demographics Manufacturing Regional

According to the Taylor Rule, the Federal Funds Rate Should Probably Be Higher—By How Much Is Uncertain

By Andrew Glover and Johnson Oliyide

Using the KC Fed Model-Based measures of r-star and u-star, the median federal funds rate consistent with the Taylor rule should be 1.6 percentage points above the August 2026 federal funds rate. Uncertainty about r-star and u-star creates a wide range of federal funds rates consistent with the Taylor rule, but most of our estimates call for at least some increase in the current federal funds rate.

Notes: The Taylor rule rate is calculated as the nominal natural rate (based on the KC Fed Model-Based Natural Rate of Interest) plus a weighted sum of the inflation gap (core PCE minus 2 percent) and the unemployment gap (unemployment rate minus the KC Fed Model-Based Natural Unemployment Rate). Weights are from Taylor (1993) with an Okun’s Law coefficient of 2. The blue line shows the median Taylor rule rate produced by the model, and the shaded region covers the middle 68 percent of the Taylor rule rate estimates.

Sources: Federal Reserve Bank of Kansas City, U.S. Bureau of Economic Analysis (Haver Analytics), U.S. Bureau of Labor Statistics (Haver Analytics), and authors’ calculations.

Download the data file for this chart.

The Taylor rule calls for the federal funds rate to increase if inflation is above 2 percent or unemployment is below the natural unemployment rate (u*), but to otherwise track the natural rate of interest (r*). Following the Taylor rule, our median estimates of u* and r* indicate a 1.6 percentage point increase in the federal funds rate relative to its August 2026 level (difference between purple and blue lines). Although uncertainty about u* and r* creates a wide range of federal funds rates consistent with the Taylor rule (gray shaded region), 73 percent of our current Taylor rule estimates call for a higher federal funds rate.
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Charting the Economy Inflation Macroeconomics Monetary Policy

Over Half of Surveyed Firms Report Decreased Profit Margins This Year, as Most Absorbed a Portion of Higher Input Costs

By Alison Felix, Max Kice and Jordan Rappaport

Over half of respondents to the Kansas City Fed’s Manufacturing and Services Surveys recently reported passing on no more than 20 percent of their higher input costs to customers, with only one in five firms passing on more than 80 percent. Over half of survey respondents also indicated that their profit margins have declined since the start of 2026.

Notes: Panel A shows survey responses to the June 2026 question, “If your firm is facing higher costs (inputs and labor), what share of those increases are you able to pass through to customers in the form of higher prices?” Panel B shows survey responses to the July 2026 question, “Given current price pressures, how have profit margins changed for your firm since the beginning of the year?”

Source: Federal Reserve Bank of Kansas City.

Most firms facing higher prices for inputs and labor are currently absorbing a large portion of these higher costs rather than passing them on to customers. Over half of respondents to the Kansas City Fed’s Manufacturing and Services Surveys recently reported passing on no more than 20 percent of their higher costs, with only one in five firms passing on more than 80 percent. Many firms have at least partly offset higher input costs by cutting other expenses or exploring efficiency gains. Even so, over half of firms report that their profit margins have declined since the start of the year.

Charting the Economy Inflation Manufacturing Regional

Employment in AI-Intensive Sectors Is Growing More Slowly

By Huixin Bi, Stephen D. Vasiljevic and Shu-Kuei X. Yang

Since November 2022, sectors with a larger share of job postings requiring AI skills have generally seen slower job growth relative to their pre-COVID trend. The information sector is the notable outlier in the chart due to its high share of AI-related jobs and its relatively small size, but job losses have also been significant in this sector since November 2022.

Notes: Each dot represents one industry at the two-digit North American Industry Classification System (NAICS) level. The horizontal axis shows the average monthly share of job postings requiring AI skills between January and May 2026. The vertical axis shows the change in average monthly job growth between November 2022 and May 2026, measured against the pre-COVID trend (January 2010–December 2019), in thousands. The fitted line shows the correlation between the two measures across industries, excluding NAICS sector 51 (Information), shown in purple.

Sources: U.S. Bureau of Labor Statistics and Lightcast.

Download the data file for this chart.

Since November 2022, sectors with a larger share of job postings requiring AI skills (horizontal axis) have generally seen slower job growth relative to their pre-COVID trend (vertical axis). This pattern offers tentative evidence that AI may be displacing workers in some sectors while augmenting them in others. The correlation is only suggestive, however, as other factors including post-pandemic demand shifts and sector-specific cycles could also be driving the differences in job growth. The information sector (purple dot) is the notable outlier in the chart due to its high share of AI-related jobs and its relatively small size, but job losses have also been significant in this sector since November 2022.

Charting the Economy AI Labor and Demographics Macroeconomics