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1997 Economic Trends

  • U.S. Bank Lending Abroad

    Late October’s financial crises in Southeast Asia have rocked U.S. equity markets and created fears of a possible decline in exports. Read More

  • The Economy in Perspective

    My dinner with André ... “Of course. I’d be delighted to come to Washington for dinner. Read More

  • Saving, Investment, and the Current Account

    The U.S. current account deficit requires an influx of foreign capital. Read More

  • New Business Formation

    In 1996, more than 170,000 new businesses were formed in the U.S., up 1.4% from the previous year. Read More

  • Monetary Policy

    At its November 12 meeting, the Federal Open Market Committee (FOMC) left the federal funds rate target unchanged at 5.5%. Read More

  • Labor Markets

    The unemployment rate reached a 24-year low in December, as strong jobs growth outpaced an expanding labor force. Nonfarm payrolls were up 404,000, pushing the unemployment rate to 4.6%, a level not seen since October 1973. Read More

  • Korean Financial Turmoil

    The recent wave of Southeast Asian financial problems broke against Korean shores in November, sending the country’s currency and stock market swirling. Read More

  • Interest Rates

    The yield curve has flattened since last month, with short rates up and long rates down. Read More

  • Inflation, Unemployment, and the Phillips Curve

    The Phillips curve—a statistical relationship between inflation and unemployment—is central to much of macroeconomic thought. Read More

  • Inflation and Prices

    The monthly price data continue to point toward only modest inflationary pressure. In October, the Consumer Price Index (CPI) rose at a 2.3% annualized pace, about ½ percentage point above its year-to-date annualized average (1.7%) ... Read More

  • Gold Prices

    The price of gold has declined through most of 1997, dipping below $300 per ounce in early December. While industrial and jewelry demand remains high, central bank sales more than offset it. Read More

  • Federal Budget Projections

    The Congressional Budget Office projects that federal outlays as a share of GDP will decline from more than 20% to about 18.5% by the year 2007. Federal revenues will fall from almost 20% to 19%. Read More

  • Economic Activity

    The Commerce Department lowered its estimate of real GDP growth from 3.5% to 3.3% in 1997:IIIQ. Read More

  • Bank Lending in the U.S.

    The Senior Loan Officer Opinion Survey on Bank Lending Practices provides insight into changes in the markets for lending by domestic banks and by branches and agencies of foreign banks operating in the U.S. Read More

  • The Stock Market Correction

    On October 27, the S&P 500 index plummeted 64.62 points, a percentage loss of 6.86%. This was the largest point drop in a single day, and the seventeenth largest percentage drop since the S&P index started in 1926. Read More

  • The Economy in Perspective

    A moment’s notice ... Those of us in the monetary policy business are used to being questioned almost daily about the meaning of a data release, a Fed official’s speech, or a financial market swing. Read More

  • Monetary Policy

    Since February 1996, the Federal Open Market Committee (FOMC) has changed the intended federal funds rate only once, raising it a modest 25 basis points at this year’s March meeting. Read More

  • Manufacturing in Ohio

    Ohio continues to be one of the most manufacturing-intensive states, with a little under 20% of all its nonfarm workers employed in the sector. Read More

  • Labor Markets

    October was characterized by widespread strength in the nation’s labor markets, as nonfarm payrolls gained an unexpectedly high 284,000 workers. Read More

  • Interest Rates

    The yield curve has flattened since last month, with rates falling for Treasuries with maturities of one year or longer, and rising for those of less than a year. Read More

  • Inflation and Prices

    The inflation indicators have accelerated a bit recently, although the year-to-date estimates are still quite low by historical standards. Read More

  • Hong Kong Financial Markets

    The financial tremors that shook Southeast Asia this summer left the Hong Kong dollar relatively unrattled. Read More

  • Higher Education: An International Perspective

    Economic theory predicts that human capital investment will be highest for younger workers, and cross-country comparisons bear this out. Read More

  • Fourth District Employment

    Like the nation as a whole, Fourth District states have witnessed sharp declines in unemployment rates since late 1991. Read More

  • Economic Activity in Industrialized Countries

    Most industrial countries entered the last recession later than the U.S. and recovered more slowly. Except for Japan, however, they are now experiencing fairly solid growth. Read More

  • Economic Activity

    The economy continues to show signs of vigor. Advance estimates from the Commerce Department indicate that real GDP grew at an annualized rate of 3.5% in 1997:IIIQ, following an increase of 3.3% in the previous quarter. Read More

  • Consumer Debt and Delinquency

    In recent months, historically high levels of consumer debt have drawn considerable attention. Read More

  • Automated Teller Machines

    Over the past 20 years, the number of automated teller machines (ATMs) in the U.S. has increased almost 23-fold. In 1976, there was approximately one ATM per 13,700 households; by 1995, there was one per 807 households. Read More

  • Trade Deficits and Economic Growth

    The U.S. merchandise trade deficit jumped unexpectedly in July, rising to $10.3 billion from $8.3 billion the month before. Read More

  • The Mexican Economy

    On September 22, the Bank of Mexico announced that it was taking policy actions designed to lower Mexican interest rates so as to reduce capital inflows and decrease international demand for the peso. Read More

  • The Economy in Perspective

    Where to, EMU? ... Many European nations have been working hard over the past several years to lower their inflation rates and trim public sector deficits. Read More

  • Stock Market Volatility

    Although the stock market has risen sharply over the last three years, a casual examination indicates a bumpier path since the middle of 1996. Read More

  • Social Security

    In a pay-as-you-go (PAYGO) public pension program like the U.S. Social Security system, the elderly dependency ratio provides a crucial link between payroll tax rates and benefit levels ... Read More

  • National Saving Trends

    Policymakers have been keeping an eye on the nation's net national saving rate, which has been trending down over the last two and a half decades. Read More

  • Monetary Policy

    The Federal Open Market Committee (FOMC) decided tat its September 30 meeting to let the federal funds rate stand at 5.5%, marking six months since the rate was last altered. Read More

  • Labor Markets

    Labor market growth in September appeared to recover from August's sluggish pace, with nonfarm payroll employment rising 215,000 nationwide. Read More

  • Inventories

    During the first half og 1997, real GDP rose by $142 billion, translating into a 4.1% annual growth rate. Over this same period, real investment in business inventories totaled $141 billion, almost equaling the rise in real output. Read More

  • Interest Rates

    In September, the yield curve on government securities moved noticeably lower (about 20 basis points), but retained its general shape. The weekly average of the 3-month constant-maturity series moved below 5%. Read More

  • Inflation and Prices

    Consumer prices rose at a 2.3% annualized rate in August, a small acceleration from the year-to-date average of 1.6%and only a shade higher than the 12-month average of 2.2%. Read More

  • Human Capital Investment

    Human capital theory suggests that training, whether formal or on the job, enhances worker productivity and thus leads to higher wages. Training prepares new workers and enhances the skills of existing workers. Read More

  • Economic Activity

    The Commerce Department's final estimate places second-quarter real GDP growth at 3.3%, down a bit from the preliminary estimate of 3.6%. Read More

  • Banking Conditions

    FDIC-insured commercial banks reported record profits of $14.6 billion in the second quarter, surpassing the previous high set in the first three months of the year. Read More

  • The UPS Strike

    A number of commentators have described the recent Teamsters' strike against UPS as a watershed moment in U.S labor history. Read More

  • The Economy in Perspective

    Paradigm Lost? ... What should we makde of the unexpectedly good macroeconomic performance of the U.S. economy in the last several years? Read More

  • Ohio Agriculture

    Unseasonable summer weather has been of great concern to Ohio farmers. Rainfall has varied widely from month to month, and temperatures have generally been below normal. Read More

  • Monetary Policy

    At its August 19 meeting, the Federal Open Market Committee (FOMC) decided to maintain the existing degree of pressure on the federal funds rate, expecting it to remain around 5.5%. Read More

  • Labor Markets

    Despite a slight slowdown, the nation's labor markets remained strong in August. Read More

  • Interest Rates

    The yield curve has steepened since the end of July, with long rates increasing about 20 basis point (b.p.) and the 3-month short rate inching up only four b.p. Read More

  • Inflation and Prices

    Inflation remained unexpectedly restrained in July, as the Consumer Price Index (CPI) rose an annualized 2.3% and the Producer Price Index (PPI) for finished goods actually fell 0.9%. Read More

  • Housing Finance

    Until recent weeks, mortgage interest rates had been on a steady downward trend, with 30-year rates falling to 7.37% at the end of July (their lowest level since March 1996). Read More

  • Floating Exchange Rates

    Since the end of the Bretton Woods fixed-exchange-rate regime, dollar exchange rates have moved in response to market forces. Isolating and explaining these forces is a task that still baffles economists. Read More

  • Fixed Exchange Rates: The Thai Baht

    Thailand, like many newly developing countries, closely links its currency to the U.S. Dollar. Read More

  • Financing the Investment Boom

    The current expansion has been characterized by an extraordinary advance in business investment, financed through both strong cashflow and substantial consumption borrowing. Read More

  • Economic Activity

    Although the major indicators of the U.S. economic activity continue to point upward, analysts are keeping a wary eye on inventories. Read More

  • Consumer Bankruptcies

    The recent rise in consumer bankruptcies continued in the second quarter, with more than 367,000 new filings nationwide. Read More

  • Coffee Production and Prices

    Coffee prices - both spot and futures - have fluctuated widely in the past year. Read More

  • U.S. Trade Balance

    The U.S. trade deficit has widened since 1991. Over the first five months of this year, the shortfall was $48.1 billion. Our largest deficits are with Japan, China, and our NAFTA partners. Read More

  • Unemployment and Job Vacancies

    The U.S. labor market is characterized by tremendous churning, with approximately 7 million people entering or leaving in a single month. Read More

  • The U.S. International Investment Position

    The U.S. current account deficit has increased thirteen-fold since 1982, reaching $148 billion in 1996 and nearly $164 billion (annual rate) in 1997:IQ. Read More

  • The Economy in Perspective

    Fiscal policy in the balance ... Earlier this month, President Clinton signed into law two bills that collectively aim to balance the federal budget and slash the public's tax obligation by the year 2002. Read More

  • Monetary Policy

    The semiannual Federal Reserve System monetary policy testimony to Congress, delivered by Chairman Greenspan on July 22, along with the Board of Governors' report, summarizes the Fed's view of current economic conditions ... Read More

  • Marriage Penalties and Bonuses

    Several features of the current income tax code result in marriage "penalties" and "bonuses." Read More

  • Labor Markets

    The nation's labor markets showed robust growth in July, with nonfarm payrolls posting a high-than-expected gain of 316,000 workers. Read More

  • Kentucky Tobacco Farming

    Tobacco is nothing to sneeze at in Kentucky, which is home to half of the nation's 124,270 tobacco farms. Read More

  • Interest Rates

    The yield curve has flattened since last month, with long rates falling and short rates rising. Read More

  • Inflation and Prices

    In June, the Consumer Price Index (CPI) rose at a mere 1.5% annualized rate, nearly the same pace it has followed since last December. Read More

  • Gold Futures, January 1980 - July 1997

    Both spot and futures prices of gold have been declining fairly steadily since March, dropping to levels not seen since the first months of 1993. Read More

  • Economic Activity

    As expected, the pace of economic activity slowed in 1997::Q. Preliminary estimates show that the economy grew 2.2% in the second quarter (down from a revised 4.9% the previous quarter). Read More

  • Durable Equipment Investment

    During the 1990s, nonresidential fixed investment (producers' durable equipment plus nonresidential structures) has surged. Read More

  • Banking Conditions

    Deregulation, new financial products and new competitors are some of the explanations for the significant changes that have occurred in the U.S. banking industry. Read More

  • The Economy in Perspective

    My dinner with Andre ... I really didn't mind that my friend was already 25 minutes late, or that the restaurant he had chosen was in a desolate section of the city. Read More

  • Regional Update: Wheeling, W Va.

    The coal mining industry - historically a predominant feature of the Wheeling, W. Va., area - is becoming an increasingly less important part of its economic landscape. Read More

  • Real GDP: Trend and Cycles

    History is the standard (a tenuous one at best) by which we often measure current macroeconomic performance. Read More

  • Population and Employment Patterns

    As American have migrated to the West and South, so have their jobs. Along the way, the composition of these jobs has changed. Read More

  • Mortgage Lending in Cleveland

    Since the early 1990s, tremendous strides have been made in improving minority access to mortgage credit. Read More

  • Money, Inflation, and Exchange Rates

    Money, inflation and exchange rates are all linked, but the connections are relatively complicated. Read More

  • Monetary Policy

    It has been more than three months since the Federal Open Market Committee (FOMC) raised the intended federal funds rate from 5 1/4% to 5 1/2%. Read More

  • Labor Markets

    Although the overall unemployment rate edged up to 5.0% in June, the most recent employment statistics continue to portray a robust labor market. Read More

  • Interest Rates

    The yield curve has flattened noticeably since last month. Although rates have fallen at all maturities, longer rates have dropped, tightening up spreads. Read More

  • Inflation and Prices

    Many marked the third consecutive month that the Consumer Price Index (CPI) rose at an annual rate of just 0.8%, bringing the year-to-date average increase to 1.4%. Read More

  • Exports and Employment

    As the U.S. economy opens up to more international trade, the popular press has tended to focus on the loss of American jobs associated with increasing imports. Read More

  • Exchange Rate Policy

    The U.S. Treasury and the Federal Reserve seem increasingly hesitant to intervene in foreign exchange markets, and for good reason. Read More

  • Economic Activity

    The economy shot up 5.9% in the first quarter, according to the Commerce Department's final appraisal. Read More

  • Banking Conditions

    Insured commercial banks reported record levels of net income in the first quarter, which translated into the fourth-highest returns on assets (ROA) ever. Read More

  • The Economy in Perspective

    With a little help from our friends ... The United States continues to import more goods and services than it sends abroad, and by a wide margin. Read More

  • The Argentine Economy

    Economists' continuing debate about the merits of fixed and floating exchange rates has led them to compare economic developments in Mexico and Argentina. Read More

  • Social Security - A Solution

    Raising taxes and cutting benefits are politically unpopular options for restoring solvency to the Social Security system. Read More

  • Social Security - A Problem

    Demographic projections indicate that the number of elderly retirees will grow sharply by 2025, but the number of young, working-age individuals will increase only slightly. Read More

  • Small Business Lending

    Between June 1995 and June 1996, small business lending grew a healthy 6.9% nationwide, to $301.8 billion outstanding. Read More

  • Secondary Mortgage Market Activity

    Mortgage originators tend to sell their fixed-rate loans to secondary-market agencies, while holding their adjustable-rate mortgages in their portfolios. Read More

  • Monetary Policy

    At its May 20 meeting, the Federal Open Market Committee (FOMC) decided to maintain it's existing degree of pressure on the federal funds rate, expecting it to remain around 5.5%. Read More

  • Labor Productivity

    Growth in labor productivity (typically measured as real output per hour of work) is critical to economic health because it is the primary source of real wage growth. Read More

  • Labor Markets

    Nonfarm payrolls grew by 138,000 in May, a smaller-than-expected gain that masked an otherwise robust labor market. Read More

  • International Capital Flows

    In 1982, the U.S. current account balance shifted into a deficit, which by 1987 had widened to $167 billion, an amount equivalent to 3.6% of GDP. Read More

  • Interest Rates

    Since April, interest rates have shifted downward. Read More

  • Inflation and Prices

    Retail prices inched up in April at an annualized 0.8%, while wholesale prices actually declined 7.0%. Read More

  • Gold Markets

    Having long ago settled down after the turmoil of the early 1980s, gold prices have continued to decline steadily from their recent peak of February 1996, as have prices on the futures market. Read More

  • Employment Variability

    Conventional wisdom says that Japanese workers tend to experience less volatility in employment than do Americans, partly because many workers in Japan's largest firms have what amounts to a life-time employment contract. Read More

  • Economic Activity

    Preliminary estimates show that the economy grew 5.8% in the first quarter, slightly faster than previously reported. Read More

  • The Daily Spin: Putting the Economy in Perspective

    The Daily Spin: Putting the Economy in Perspective. Read More

  • The Benefits of NAFTA

    The North American Free Trade Agreement (NAFTA), which took effect on January 1, 1994, will curtail most barriers to trade and investment between Canada, Mexico and the U.S. by the time it is fully implemented in 2004. Read More

  • Social Security Insolvency

    The surge in U.S. birth rates between the mid-1940s and mid-1960s implies that an increasing share of the population will be retired in the coming decades. Read More

  • Precious Metal Prices

    Although the U.S. is no longer on a gold or silver standard, the prices of these precious commodities still command widespread attention. Read More

  • Monetary Policy: A Long-Term Perspective

    The financial press has given much attention to the 25-basis-point increase in the federal funds rate on March 25. Read More

  • Monetary Policy

    Since the Federal Open Market Committee (FOMC) announced an expected 1/4-percentage -point increase in the federal funds rate at it's March 25 meeting, short-term interest rates have changed very little. Read More

  • Medicare Insolvency

    The Hospital Insurance trust fund (Medicare - Part A), which covers hospital services, home health care, hospice stays, and skilled nursing services for the elderly, is in much deeper trouble than Social Security. Read More

  • Labor Markets

    Labor market growth in April matched March's slow pace, with nonfarm payroll employment rising 142,000. Read More

  • International Trade

    The U.S. merchandise trade deficit narrowed to $10.4 billion in February, but has clearly widened over the current business expansion. The U.S. maintains deficits with nearly all regions of the globe. Read More

  • Interest Rates

    The yield curve has steepened slightly since last month, with short rates falling and long rates rising. Read More

  • Inflation and Prices

    The monthly inflation indicators moderated considerably in March. Read More

  • Employment Costs

    Concerns about inflationary pressures in the labor market have made the Employment Cost Index (ECI) one of the most anticipated economic indicators. Read More

  • Economic Activity

    Advance estimates released by the Commerce Department in late April show real GDP rising 5.6% in the first quarter - the largest gain in nearly 10 years and one that substantially exceeded expectations. Read More

  • Banking Conditions

    The latest statistics on insured U.S. commercial banks confirm the industry's strength. Read More

  • Workplace Fatalities

    Real wages represent only one aspect of the employment contract. Another aspect is working conditions, especially the safety of the environment. Read More

  • The Stock Market

    The bull market of 1996-97 continues to garner headlines. The standard graphs may exaggerate recent gains, however, because they do not take account of the market's previous run-up. Read More

  • The Federal Budget

    If economic models are economists' stock-in-trade, the the assumptions used to construct them are their critical raw materials. Read More

  • The Economy in Perspective

    What goes around comes around ... Before anyone gets the wrong idea, let's be clear about one thing: This is not another essay declaring that business cycles are dead. Read More

  • State Employment Patterns

    Regional labor market data from January 1996 to January 1997 show a pattern of widespread growth across the country, with a 2.2% overall increase in employment. Read More

  • Monetary Policy

    Immediately after its March 25 meeting, the Federal Open Market Committee (FOMC) of the Federal Reserve System announced that it had "decided to tighten money market conditions slightly, expecting the federal funds rate ... Read More

  • Labor Markets

    Despite slower employment growth in March, the labor situation continues to brighten. Nonfarm payrolls advanced at a moderate pace (175,000 net new jobs). Read More

  • Intrafirm Trade

    International direct investment surged in the last 1980s. Both U.S. direct investments in foreign countries and foreign investments in the U.S. have been growing rapidly, with the former exceeding the latter by a widening margin. Read More

  • Interstate Population Migration

    Migration patterns over the past seven years show that Rust Belt states continue to experience out-migration. Read More

  • Interest Rates

    Since last month, the yield curve has shifted upward in a parallel fashion, with most of the increase following a rise of 25 basis points in the federal funds rate. Read More

  • Inflation and Prices

    On March 25, the Federal Open Market Committee (FOMC) took a small and perhaps cautious step toward monetary restraint by raising the federal funds target by 1/4 percentage point, it's first overt policy action since January 1996. Read More

  • Foreign Output and Prices

    Foreign economic activity continues its moderate expansion, while inflation pressures remain subdued. Read More

  • Economic Activity

    The nineteenth-century historian Thomas Carlyle once suggested that economics was simply a matter of supply and demand. Read More

  • Banking Conditions

    The run-up in bank share prices has recently abated. This is consistent with concerns over possible over-valuation of bank stocks and reports that bank insiders have been selling stocks for months. Read More

  • U.S. Productivity Growth

    Between 1965 and 1973, U.S. annual productivity growth (measured as output per hour worked) averaged 1.5%. Read More

  • The Economy in Perspective

    Laboring under a false impression ... If inflation is, as Milton Friedman once said, always and everywhere a monetary phenomenon, why do so many Fed-watchers scan the labor market for clues to future inflation? Read More

  • The Eastern Kentucky Economy

    The Fourth Federal Reserve District includes the eastern half of Kentucky, which, because of its coal supplies, has closer economic ties to the industrial economies of Pittsburgh and Cleveland than to the more agricultural western counties. Read More

  • The Current Account and the U.S. Dollar

    Observations that the dollar is over-valued imply that its current level is unsustainable and that its recent path is inconsistent with a growing U.S. current account (trade) deficit. Read More

  • Monetary Policy

    Mention monetary policy, and the first thing that many people think of is the federal funds rate. Read More

  • Labor Markets

    U.S. labor markets continued to reflect a healthy economy in February as nonfarm payroll employment expanded by 339,000 - the largest gains in May. Read More

  • Interest Rates

    Since last month, the yield curve has flattened slightly, with very little movement except at the long end. Read More

  • Inflation and Prices

    Substantial declines in a handful of categories contributed to mild increases in the major price indexes in January. Read More

  • Economic Activity

    The U.S. Commerce Department recently lowered its estimate of fourth-quarter real GDP growth from 4.7% to 3.9%. Still, the economy's end-of-year performance remained well about the third-quarter's 2.1% pace. Read More

  • Cost-of-Living Adjustments

    Cost-of-living adjustments (COLAs) are contract clauses that explicitly tie wages and benefits to the inflation rate. Read More

  • Banking Consolidation and Small Business Lending

    Historically, banks in the U.S. have been subject to myriad restrictions on their geographic expansion. At the beginning of the century, most states allowed banks to only have one office. Read More

  • The Economy in Perspective

    The Big Chill ... The Soviet Union was officially dissolved on December 26, 1991, one clay after the resignation of Rilikhail Gorbachev. The Cold War was over. Read More

  • Structural Changes in US. Fiscal Policy

    Federal spending has consistently outpaced federal revenues since the 1970s. Although the opposite is true for the sum of state and local budget, the total national debt (both nominal and inflation adjusted) has mushroomed over the last 25 years. Read More

  • Monetary Policy and Global Competition

    The dollar's recent sharp rise against the yen has intensified long-held concern about Japanese manufacturers' competitive edge in U.S. markets. Read More

  • Monetary Policy and Economic Growth

    Although most economists will concede that monetary policy can affect real economic growth over the short run, many caution against attempting to manage business cycles through policy manipulation. Read More

  • Monetary Policy

    Every narrow money measure except currency fell in January. Currency grew 4.7%, which was slightly slower than its 1996 average rate of 5.7%. Read More

  • Labor Markets

    Nonfarm payrolls grew by 271,000 in January, continuing the fourth quarter's string of vigorous increases. Read More

  • Interest Rates

    Interest rates have moved up since last month, and the yield curve has steepened. Read More

  • Inflation and Prices

    Economists' 1997 projections for retail price inflation are narrowly distributed. Read More

  • Housing Finance

    After declining steadily since September 1996, 30-year fixed mortgage rates have jumped 40 basis points from December's low of 7.38%. Read More

  • Household Debt and Delinquencies

    Over the last few years, the ratio of household debt to disposable income has reached historic high levels, raising concerns about the financial stability of U.S. households. Read More

  • Employment Trends

    Despite periodic fluctuations in the pace of U.S. economic activity, the percentage of working age Americans who are employed has risen steadily since the early 1970s and now stands at a record 63.4%. Read More

  • Employment Cost Index

    The Employment Cost Index (ECI) is the best measure of compensation (wages and benefits) growth available to labor analysts. Read More

  • Economic Activity

    In like a lamb, out like a lion. According to advance estimates, real GDP grew an exceptionally fast 4.7% in 1996:IVQ, with gains in exports and personal consumption expenditures leading the way. Read More

  • The U.S. Workforce

    Nothing is more certain than change, particularly economic change. The last 3 years have witnessed a dramatic transformation in the educational attainment of the U.S. workforce, along with a narrowing of race- and sex-related pay disparities. Read More

  • The Stock Market

    Although volatile, stock prices have been trending upwards since 1982. The Standard & Poor's (S&P) 500 index stood at 741 on December 31, 21% above it's year-end 1995 level. Read More

  • The Mexican Economy

    Two years after the disruptive peso depreciation, the outlook for Mexico is brightening. Our NAFTA partner has regained access to international capital markets and can now repay it's creditors. Read More

  • The Economy in Perspective

    Dead reckoning ... The beginning of a new year always brings increased attention to the economic outlook, as though the prospect of another lap around the sun endows economists with fresh insights about more earthly navigation. Read More

  • Regional NAIRU

    Some policy makers view the concept of NAIRU, the non-accelerating inflation rate of unemployment, as consistent with an equilibrium unemployment rate. Read More

  • Regional Conditions

    Although more than half of the Fourth Federal Reserve District's counties posted unemployment rates at or below the national average in October, many others continued to exceed it, one by as much as 8.8 percentage points (Knox County, Kentucky). Read More

  • Official Foreign Capital Flows

    Over the first three quarters of 1996 the U.S. current account deficit grew at a $123 billion annual rate, somewhat slower than in the previous two years. Read More

  • Monetary Policy

    At its December 17 meeting the Federal Open Market Committee again left the intended federal funds rate unchanged at 5.25%. Read More

  • Labor Markets

    Labor markets remained solid in 1996, with 2.3 million jobs being added to the nation's payrolls. Read More

  • Interest Rates

    The yield curve has steepened over the last month and remains steeper than this time last year, being higher at the long end and lower at the short. Read More

  • Inflation and Prices

    The Consumer Price Index (CPI) rose 3.1% in November, just a bit under its average increase of the last 12 months. The median CPI, a measure of core inflation, advanced at a slightly slower pace. Read More

  • Economic Activity

    Revised Commerce Department estimates indicate that real GDP grew 2.1% in 1996:IIIQ, down from an atypically high 4.7% in the previous quarter. Read More

  • Banking Conditions

    Short-term bank deposit rates have declined slightly since October. Read More