Federal Government Outlays Remain Historically Elevated, Spurred by Robust Transfers
Over the past six decades, the federal government has shifted a larger share of its outlays toward transfer payments to individuals and state and local governments. These longer-run trends were exacerbated during the pandemic, leading to higher deficits for the federal government and an increasingly high share of federal outlays supporting the economy through consumer spending.
Macroeconomics
Economic Bulletin
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Huixin Bi
Alison Felix
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November 22, 2024
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Cost of Childcare Increasingly Weighs on Labor Force Engagement
Problems attaining childcare have weighed on workers’ engagement in the labor force for some time. A few years ago, pandemic disruptions were the primary culprit in the lower consumption of childcare services. Now, the rising cost of childcare may be to blame. As wage growth moderates, higher childcare costs could place added pressure on households and cause some workers to at least partially disengage from the workforce.
Labor and Demographics
Regional
Economic Bulletin
Inflation
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John McCoy
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October 9, 2024
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Powering Up: The Surging Demand for Electricity
After years of stagnant growth, U.S. electricity demand recently surged. This increase was driven in part by the commercial sector, particularly the rapid expansion of data centers and the adoption of artificial intelligence. The surge is expected to continue, signaling a shift toward a more electrified economy, with significant implications for economic competitiveness and energy infrastructure.
Natural Resources and Environment
Economic Geography
Macroeconomics
Economic Bulletin
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Nida Çakır Melek
Alex Gallin
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September 25, 2024
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Why Are Multifamily Property Prices Falling?
Multifamily property prices climbed to record levels in recent years amid low interest rates and surging housing demand. More recently, prices have retreated in the face of higher interest rates, slower rent growth, elevated operating expenses, and increased delivery of new units available for rent. However, the deterioration in these fundamentals does not fully explain recent property price declines, suggesting investors’ near-term outlooks have been pessimistic.
Housing
Banking and Finance
Economic Bulletin
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Matt Hanauer
W. Blake Marsh
Nicholas Sly
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September 4, 2024
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Considerations for the Longer-Run Maturity Composition of the Federal Reserve’s Treasury Portfolio
The Federal Reserve’s Treasury portfolio is weighted toward long-duration assets, reflecting large-scale asset purchases deployed after the financial crisis and again during the pandemic. In the longer run, policymakers may prefer to return to a shorter-duration Treasury portfolio like the Fed maintained before 2008. However, the exact composition of the portfolio will depend on how policymakers balance competing considerations: policy space, interest rate risk, market neutrality, and safe-asset provision.
Monetary Policy
Banking and Finance
Economic Bulletin
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Rajdeep Sengupta
A. Lee Smith
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August 28, 2024
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Data file for "Labor Shortages in the Healthcare Sector Have Eased, Which May Soften Price Pressures"
Data file for "Labor Shortages in the Healthcare Sector Have Eased, Which May Soften Price Pressures" by Johannes Matschke and Emily Pollard, Economic Bulletin, August 16, 2024.
Economic Bulletin
Inflation
Labor and Demographics
Macroeconomics
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Emily Pollard
Johannes Matschke
Emily Pollard
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August 23, 2024
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Labor Shortages in the Healthcare Sector Have Eased, Which May Soften Price Pressures
Following severe labor shortages during the post-pandemic recovery, employment and wage growth in the healthcare sector have returned to their pre-pandemic trends. The healthcare sector is labor intensive, and inflation in the sector has historically tracked wage growth. Thus, lower wage growth may limit price pressures in the healthcare sector.
Labor and Demographics
Macroeconomics
Economic Bulletin
Inflation
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Johannes Matschke
Emily Pollard
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August 16, 2024
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Why Haven’t Recent Rate Increases Slowed the Economy More? Look to Unusually Low Private-Lending Spreads
Despite a large and rapid increase in the policy rate since March 2022, economic activity has remained resilient. We argue that private-lending spreads—the difference between the policy rate and rates private-sector borrowers pay—are surprisingly low and a major factor for why rate hikes have not slowed the economy more. If spreads are as insensitive to rate cuts as they are to rate hikes, then they may dampen the effect of expansionary monetary policy.
Monetary Policy
Banking and Finance
Economic Bulletin
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Andrew Glover
Johnson Oliyide
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August 14, 2024
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Agricultural Economic Summit Highlights Growing Connection Between Agriculture and Energy
The agriculture and energy sectors have become more tightly connected as renewable energy increases demand for input crops and creates alternative income opportunities for farms. Industry experts underscored these links at the Kansas City Fed’s Agricultural Economic Summit in May. Despite some longer-run uncertainties, Summit participants expect energy investments and developments to have a significant influence on the future structure of ag and commodity markets.
Natural Resources and Environment
Energy
Regional
Economic Bulletin
Agriculture
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Nate Kauffman
Ty Kreitman
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August 5, 2024
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Consumer Discretionary Sector Has Boosted Recent Regional Services Activity as Business and Professional Activity Slows
The Kansas City Fed’s monthly services survey tracks business activity for a wide variety of services firms in the Tenth District. We segment the results into consumer services (both discretionary and nondiscretionary) and business and professional services and find that the consumer sector has been stronger than the business and professional sector recently, driven by discretionary services. Accordingly, consumer services firms report greater pricing power, expected wage growth, and capital expenditures.
Regional
Data and Trends
Economic Bulletin
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Chad Wilkerson
Chase Farha
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June 26, 2024
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