Search Results
Journal Article
Decomposing inflation
As U.S. core inflation measures have declined in recent years, analysts have renewed their efforts to understand inflation dynamics. A common approach to this issue is to make inferences about how price changes of major components affect the aggregate inflation rate. This article takes a more rigorous approach, calculating and plotting the precise contributions of major consumer expenditure categories to core inflation measures over time. ; This technique has distinct advantages. It highlights the underlying trends in inflation, enabling analysts to make more informed inferences about the ...
Journal Article
District digest : Economic trends across the region
"The Roles of New and Existing Establishments in Employment in the Fifth District," article by R. Andrew Bauer, pg. 36-39
Discussion Paper
What Businesses Are Saying: The Impact of the Conflict Has Been Limited ... For Now
Overall Momentum: Did the Conflict Cause Businesses or Consumers to Pull Back?Firms demonstrated patience amid uncertainty. Business leaders shared that increased policy uncertainty over the last year had taught them to calmly wait and see. This meant paused investments for some, as they waited to see how the conflict would impact supply chains, input costs and demand.Consumers continued to show resilience. Firms flagged a few cases of stress among middle-income consumers. Beyond that, however, firms were surprised at the lack of demand response to the conflict in the Middle East. Consumers ...
Working Paper
Transparency, expectations, and forecasts
In 1994, the Federal Open Market Committee (FOMC) began to release statements after each meeting. This paper investigates whether the public?s views about the current path of the economy and of future policy have been affected by changes in the Federal Reserve?s communications policy as reflected in private sector?s forecasts of future economic conditions and policy moves. In particular, has the ability of private agents to predict where the economy is going improved since 1994? If so, on which dimensions has the ability to forecast improved? We find evidence that the individuals? forecasts ...
Discussion Paper
What Businesses Are Saying: Cautiously Optimistic With a Hint of Wariness
In the lead-up to the December Federal Open Market Committee cycle, we heard that the economy was chugging along with disproportionate support from high-income consumers and artificial intelligence (AI). Many firms noted they were hesitant to invest or hire too significantly going into 2026; uncertainty and costs remained too high. Consumers pushed back against price increases, squeezing margins. Labor availability was improving, but skill and geographic mismatches continued, and there were no signs that either hiring or firing would pick up soon. You can read more in December's "What ...
Journal Article
Post-Recession Labor Market Trends in the Fifth District
Journal Article
Understanding Recent Trends in Labor Market Participation
District Digest: Understanding Recent Trends in Labor Market Participation
Discussion Paper
Why Businesses Say Tariffs Have a Delayed Effect on Inflation
Ever since new tariffs were enacted in early 2025, a key policy question has been what is the extent to which businesses will pass tariff costs through to prices, and when? The effects of a tariff are rarely straightforward, given, among other things, competitive dynamics and the challenges of implementation, but the historically large and changing nature of these tariffs have created additional levels of uncertainty over the effects.In uncertain times, anecdotal evidence from businesses can be especially insightful. We are learning how businesses are reacting to tariffs through the Richmond ...
Discussion Paper
What Businesses Are Saying: Activity Up, but Expectations Mixed
The Richmond Fed is an on-the-ground Reserve Bank. Our economic sensing team is constantly in the Fifth District, meeting with firms across industries to put together — piece by piece — a picture of where the economy stands. With the help of a robust network of business leaders willing to share what they're seeing, thinking and planning, we can get a regular pulse on the economy and check in on specific sectors as needed on an ad hoc basis.On-the-ground sensing provides critical information toward our real-time understanding of the economy. Sensing is a supplement to our in-house surveys ...
Briefing
Where are households in the deleveraging cycle?
The ratio of household debt to disposable personal income fell rapidly during the recession of 2007-09 as consumers defaulted on loans, paid down debt, and took out fewer loans. According to some economists, this household debt reduction ? "deleveraging" ? has constrained consumer spending, contributing to a longer, deeper recession and a slower recovery. As households strengthen their balance sheets, their ability to take on new debt to finance consumption is improving, but household debt remains elevated by historical standards, and other determinants of consumer spending remain weak.