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Bank:Federal Reserve Bank of Dallas 

Has the Beige Book become disconnected from economic data?

The Federal Reserve's Beige Book, a key tool for identifying U.S. business-cycle shifts, has traditionally aligned with economic data. However, postpandemic, its economic characterizations often appear weaker than what hard data indicated, raising concerns of divergence from official statistics.
Dallas Fed Economics

Will AI replace your job? Perhaps not in the next decade

Recent rapid improvements in the capabilities of artificial intelligence have raised concerns about these technologies' impact on employment. The ultimate effects of AI on the workforce will depend on the extent to which AI augments (or complements) rather than automates (or substitutes for) workers' tasks. Will this new technology aid workers or replace them?
Dallas Fed Economics

Advances in AI will boost productivity, living standards over time

Artificial intelligence offers the potential to improve people’s living standards. Such advances can be approximated by changes in GDP per capita over time. Using that common measure, AI could enhance longstanding productivity gains or, alternatively, drastically alter the economy in relatively short order.
Dallas Fed Economics

Declining immigration weighs on GDP growth, with little impact on inflation

Unauthorized immigration surged sharply in 2021–24 but has since declined abruptly with negative implications for economic growth. Estimates based on historical data and a structural vector autoregression model suggest gross domestic product growth in 2025 is 0.75 to 1 percentage points lower than in a benchmark simulation using the Congressional Budget Office’s immigration projections through November 2024.
Dallas Fed Economics

How sensitive is the Treasury cash-futures basis trade to funding condition shifts?

The Treasury cash-futures basis trade, a very large, leveraged Treasury trade, has drawn scrutiny because unwinding positions amplified stress during the pandemic-era market shock of March 2020. With estimates suggesting the trade has since grown larger, attention is focused on how well it might weather future shocks.
Dallas Fed Economics

Texas firms open to AI as tariff work-around strategy

Firms are adopting AI and automation to offset rising tariff costs and shrinking margins, aiming to boost productivity and reduce labor needs amid economic challenges.
Dallas Fed Economics

How do reciprocal deposit networks interact with deposit insurance?

Reciprocal deposit networks are designed to increase the total amount eligible for FDIC deposit insurance. In recent years, growth of the networks has accelerated, prompting a re-evaluation of the existing deposit insurance framework and raising at least three questions.
Dallas Fed Economics

Accounting for interest rate risk: Matching Fed assets to liabilities

The Fed has floating-rate liabilities as well as long-lived, zero-interest liabilities. A barbell of floating-rate and long-duration assets would best offset the interest rate risk from these liabilities. Investing in a more diversified mix of durations, while matching the average duration of assets, could be more practical than the barbell approach but would leave a substantial portion of interest rate risk unhedged.
Dallas Fed Economics

How sensitive are interest rates to higher federal debt?

The U.S. faces a historically high federal debt-to-GDP ratio, a measure of debt relative to economic output. But how sensitive are interest rates to higher debt?
Dallas Fed Economics

Falling rates no assurance of homeowner refinancing binge

When the Fed lowers its benchmark policy rate, the reduction is usually reflected in a variety of consumer finance rates, notably mortgages. However, there are reasons to believe that such a reduction might not prompt an increase in the volume of mortgage refinances and prepayment activity as has historically occurred.
Dallas Fed Economics

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