#FEDSNote

Line chart showing expected inflation (purple line) and expected wage growth (green line) from 2014 to 2025 as probability-weighted mean forecasts. Expected inflation begins around 4.5% in 2014, gradually declines to approximately 3% by 2016-2017, and remains relatively stable around 3-3.5% through 2019. A vertical gray bar marks 2020. After 2020, expected inflation surges dramatically, rising from under 4% to peak near 8% in 2022, then declining to around 5% by 2025. Expected wage growth remains relatively stable throughout, fluctuating between 2.5-3.5% from 2014-2020, briefly dipping in 2020, then rising to 3.5% in 2021-2022, and remaining around 3-3.5% through 2025. The chart demonstrates the significant divergence between inflation and wage growth expectations during the post-2020 period.

Consumers' inflation expectations closely tracked actual inflation before, during, and after the Covid-19 pandemic. This #FEDSNote explores consumers' wage and income growth expectations, which remained stable during this time despite surging wages: www.federalreserve.gov/econres/note...

Figure 4. Tariff effects on core PCE prices. This stacked bar chart shows the cumulative effect of tariff waves from February 2025 to June 2026 on core PCE prices. The y-axis shows percentage effects from 0 to 0.9%. Different colored segments represent various tariff waves (Feb, Mar, Apr, Aug, Nov 2025). Black dots indicate total effects, which increase from nearly 0% in February 2025 to approximately 0.9% by June 2026. The forecast region (shaded blue) assumes no additional tariff changes beyond those in table 1 and no additional pass-through seven months after implementation. Note: Black dots show total tariff effects, summing across positive and negative tariff wave contributions. The forecast region, shaded in blue, assumes no additional tariff changes beyond those in table 1 and no additional tariff pass-through seven months after a tariff change. Key identifies in order from top to bottom. Source: Authors' calculations using data from the BEA, BLS, Census, the Executive Office, the Federal Registrar, and Customs and Border Protection.

ICYMI: The authors estimate that the tariffs implemented through November of 2025 can explain the entirety of excess inflation in the core goods category and contributed to a 0.8 percent boost in core PCE prices through February 2026. www.federalreserve.gov/econres/note... #FEDSNote

Mind the Gap: Announced versus Implied Tariff Rates in Recent Trade Policy Episodes The Federal Reserve Board of Governors in Washington DC.

ICYMI: New #FEDSNote: Mind the Gap: Announced versus Implied Tariff Rates in Recent Trade Policy Episodes: www.federalreserve.gov/econres/note...

Stablecoins in 2025: Developments and Financial Stability Implications The Federal Reserve Board of Governors in Washington DC.

ICYMI: This #FEDSNote examines stablecoin growth and developments in 2025, which introduce novel financial stability risks: (1) complex intermediation chains, (2) vertical integration, (3) retail adoption via digital wallets. These may amplify run risk. www.federalreserve.gov/econres/note...

India and the Global Economy The Federal Reserve Board of Governors in Washington DC.

ICYMI: India is the world's fastest-growing major economy, but its path differs from China's export-led model. Can India compete in global manufacturing? Will AI disrupt its services boom? New #FEDSNote explores: www.federalreserve.gov/econres/note...

Figure 4. Tariff effects on core PCE prices. This stacked bar chart shows the cumulative effect of tariff waves from February 2025 to June 2026 on core PCE prices. The y-axis shows percentage effects from 0 to 0.9%. Different colored segments represent various tariff waves (Feb, Mar, Apr, Aug, Nov 2025). Black dots indicate total effects, which increase from nearly 0% in February 2025 to approximately 0.9% by June 2026. The forecast region (shaded blue) assumes no additional tariff changes beyond those in table 1 and no additional pass-through seven months after implementation. Note: Black dots show total tariff effects, summing across positive and negative tariff wave contributions. The forecast region, shaded in blue, assumes no additional tariff changes beyond those in table 1 and no additional tariff pass-through seven months after a tariff change. Key identifies in order from top to bottom. Source: Authors' calculations using data from the BEA, BLS, Census, the Executive Office, the Federal Registrar, and Customs and Border Protection.

The authors estimate that the tariffs implemented through November of 2025 can explain the entirety of excess inflation in the core goods category and contributed to a 0.8 percent boost in core PCE prices through February 2026. www.federalreserve.gov/econres/note... #FEDSNote

Mind the Gap: Announced versus Implied Tariff Rates in Recent Trade Policy Episodes The Federal Reserve Board of Governors in Washington DC.

New #FEDSNote: Mind the Gap: Announced versus Implied Tariff Rates in Recent Trade Policy Episodes: www.federalreserve.gov/econres/note... #EconSky

Stablecoins in 2025: Developments and Financial Stability Implications The Federal Reserve Board of Governors in Washington DC.

This #FEDSNote examines stablecoin growth and developments in 2025, which introduce novel financial stability risks: (1) complex intermediation chains, (2) vertical integration, (3) retail adoption via digital wallets. These may amplify run risk. www.federalreserve.gov/econres/note... #EconSky

India and the Global Economy The Federal Reserve Board of Governors in Washington DC.

India is the world's fastest-growing major economy, but its path differs from China's export-led model. Can India compete in global manufacturing? Will AI disrupt its services boom? New #FEDSNote explores: www.federalreserve.gov/econres/note... #EconSky

Monitoring AI Adoption in the US Economy The Federal Reserve Board of Governors in Washington DC.

ICYMI: New #FEDSNote: Monitoring AI Adoption in the US Economy: www.federalreserve.gov/econres/note...

Is the Inflation Process in Advanced Economies Different After the Pandemic? The Federal Reserve Board of Governors in Washington DC.

ICYMI: New #FEDSNote: Is the Inflation Process in Advanced Economies Different After the Pandemic?: www.federalreserve.gov/econres/note...

Payment Stablecoins and Cross Border Payments: Benefits and Implications for Monetary Policy Implementation The Federal Reserve Board of Governors in Washington DC.

ICYMI: New #FEDSNote: Payment Stablecoins and Cross Border Payments: Benefits and Implications for Monetary Policy Implementation: www.federalreserve.gov/econres/note...

Monitoring AI Adoption in the US Economy The Federal Reserve Board of Governors in Washington DC.

New #FEDSNote: Monitoring AI Adoption in the US Economy: www.federalreserve.gov/econres/note...

Payment Stablecoins and Cross Border Payments: Benefits and Implications for Monetary Policy Implementation The Federal Reserve Board of Governors in Washington DC.

New #FEDSNote: Payment Stablecoins and Cross Border Payments: Benefits and Implications for Monetary Policy Implementation: www.federalreserve.gov/econres/note...

Is the Inflation Process in Advanced Economies Different After the Pandemic? The Federal Reserve Board of Governors in Washington DC.

New #FEDSNote: Is the Inflation Process in Advanced Economies Different After the Pandemic?: www.federalreserve.gov/econres/note...

AI Adoption and Firms' Job-Posting Behavior The Federal Reserve Board of Governors in Washington DC.

New #FEDSNote: AI adoption, whether at the firm or industry level, has had no discernable negative impact on job posting behavior: www.federalreserve.gov/econres/note... #EconSky

China’s Trade Dominance and the Role of Industrial Policies The Federal Reserve Board of Governors in Washington DC.

Industrial policies are central to this rise, shaping where China gains its competitive edge and how global markets adjust. This new #FEDSNote unpacks these trends and what they mean for policymakers and businesses alike. (2/2) www.federalreserve.gov/econres/note...

Figure 4. Price changes in 2025 by country of origin This is a bar chart showing monthly 12-month percent changes in the country-specific Numerator Fisher Price Indices for January through December 2025. The y-axis shows percent values ranging from approximately -1 to 8.5 percent. The chart displays five variables: USA (blue bars), Canada (green bars), Mexico (yellow bars), China (purple bars), and Others (orange bars). The data reveals a pattern of increasing price changes throughout the year, particularly for China and the Others category. In January and February, most countries show modest changes between -0.5 and 1 percent, with some negative values. From March through July, price changes generally remain below 2.5 percent across all countries. Starting in August, China's price changes accelerate significantly, reaching approximately 5.7 percent, then continue climbing to peak at about 8.3 percent in December. The Others category follows a similar but less dramatic upward trend, reaching about 5.3 percent by December. USA, Canada, and Mexico maintain more moderate price changes throughout the year, typically staying below 2.5 percent. Note: 12-month percent changes in the country-specific Numerator Fisher Price Indices for January through December 2025. The key identifies bars in order from left to right. Source: Matched Numerator Panel Data and Label Insight Data, authors' calculations.

This #FEDSNote shows that price pressures developed gradually in 2025 rather than showing up as a one-time price spike and tariff effects have been greatest for goods imported from China with 8.5% year-over-year price increase by December 2025. www.federalreserve.gov/econres/note...

Measuring Shocks to Banks’ Expectations for Lending Standards Using the Senior Loan Officer Opinion Survey The Federal Reserve Board of Governors in Washington DC.

These shocks can better predict banks’ changes in standards than their reported outlook. (2/2) www.federalreserve.gov/econres/note... #EconSky #FEDSNote

Measuring Shocks to Banks’ Expectations for Lending Standards Using the Senior Loan Officer Opinion Survey The Federal Reserve Board of Governors in Washington DC.

ICYMI: Banks’ outlook for lending standards is shaped by macro forecasts, macro-financial conditions, and bank characteristics, as well as by shocks unrelated to these factors, which the authors isolate as the E-CSI. (1/2) www.federalreserve.gov/econres/note... #EconSky #FEDSNote

Assessing Bank Resilience to a Funding Shock The Federal Reserve Board of Governors in Washington DC.

ICYMI: New #FEDSNote: Assessing Bank Resiliency to a Funding Shock: www.federalreserve.gov/econres/note... #EconSky

Measuring Shocks to Banks’ Expectations for Lending Standards Using the Senior Loan Officer Opinion Survey The Federal Reserve Board of Governors in Washington DC.

These shocks can better predict banks’ changes in standards than their reported outlook. (2/2) www.federalreserve.gov/econres/note... #FEDSNote

The Global Trade Effects of the AI Infrastructure Boom The Federal Reserve Board of Governors in Washington DC.

ICYMI: New #FEDSNote: The Global Trade Effects of the AI Infrastructure Boom: www.federalreserve.gov/econres/note...

Downside and Upside Economic Uncertainty The Federal Reserve Board of Governors in Washington DC.

Over this period, trade uncertainty was largely due to its upside component, reflecting generally positive surprises in trade flows relative to model forecasts. (2/2) www.federalreserve.gov/econres/note... #FEDSNote

Downside and Upside Economic Uncertainty The Federal Reserve Board of Governors in Washington DC.

ICYMI: Using an econometric-based uncertainty measure, the authors find that, in 2025, elevated trade uncertainty was the main driver of aggregate economic uncertainty in the U.S. (1/2) www.federalreserve.gov/econres/note... #FEDSNote

Assessing Bank Resilience to a Funding Shock The Federal Reserve Board of Governors in Washington DC.

New #FEDSNote: Assessing Banks Resiliency to a Funding Shock: www.federalreserve.gov/econres/note...

Why have far-forward nominal Treasury rates increased so much in the past few years? Old risks reemerge in an era of Fed credibility The Federal Reserve Board of Governors in Washington DC.

ICYMI: New #FEDSNote: Why have far-forward nominal Treasury rates increased so much in the past few years? Old risks reemerge in an era of Fed credibility: www.federalreserve.gov/econres/note...

A Brief Illustrated History of the Federal Reserve's Balance Sheet The Federal Reserve Board of Governors in Washington DC.

ICYMI: New #FEDSNote: A Brief Illustrated History of the Federal Reserve's Balance Sheet: www.federalreserve.gov/econres/note...

Measuring Cross-Border Securities Positions: Explaining Asymmetries between U.S. Treasury TIC and IMF PIP (formerly CPIS) Data The Federal Reserve Board of Governors in Washington DC.

ICYMI: New #FEDSNote: Measuring Cross-Border Securities Positions: Explaining Asymmetries between U.S. Treasury TIC and IMF PIP (formerly CPIS) Data: www.federalreserve.gov/econres/note...