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U.S. output has expanded only slowly since the recession trough in 2009, counter to normal expectations of a rapid cyclical recovery. Removing cyclical effects reveals that the deep recession was superimposed on a sharply slowing trend in underlying growth. The slowing trend reflects two factors: slow growth of innovation and declining labor force participation. Both of these powerful adverse forces were in place before the recession and, thus, were not the result of the financial crisis or policy changes since 2009., Since the end of the severe recession of 2007-09, forecasters and policymakers have been persistently overoptimistic about the pace of future economic growth (Lansing and Pyle 2015). Despite steady improvements [...]

Interest rates in the United States have diverged from the rates of other countries over the past few years. Some commentators have voiced concerns that, as a result, exchange rates [...]

Slowing growth in U.S. productivity after 2004 is sometimes blamed on measurement problems, particularly in assessing the gains from innovation in IT-related goods and services. However, mismeasurement also occurred before [...]

Estimates suggest the new normal for U.S. GDP growth has dropped to between 1 1/2 and 1 3/4%, noticeably slower than the typical postwar pace. The slowdown stems mainly from demographics and educational attainment. As baby boomers retire, employment growth shrinks. And educational attainment of the workforce has plateaued, reducing its contribution to productivity growth through labor quality. The GDP growth forecast assumes that, apart from these effects, the modest productivity growth is relatively 'normal'-in line with its pace for most of the period since 1973., Economic growth during the recovery has been slower on average than its trend from before the Great Recession, prompting policymakers to ask if there is a 'new normal' for U.S. [...]

Information technology fueled a surge in U.S. productivity growth in the late 1990s and early 2000s. However, this rapid pace proved to be temporary, as productivity growth slowed before the Great Recession. Furthermore, looking through the effects of the economic downturn on productivity, the reduced pace of productivity gains has continued and suggests that average future output growth will likely be relatively slow., The past decade has been wrenching for the U.S. and global economies. In the depths of the Great Recession, the U.S. unemployment rate rose to 10%, reflecting an economy operating [...]

Financial liberalization in China has broad implications, including changing how its central bank's monetary policy affects the nation's economy. An estimate of Chinese economic activity and inflation based on a broad set of indicators suggests that the way policy is transmitted to China's economy has become more like Western market economies in the past decade. Although Chinese monetary policy may actually have exacerbated its economic downturn during the global financial crisis, a move toward stimulatory policy has helped ease its slower growth more recently., China's economy has experienced remarkable structural and institutional changes in recent decades. These changes may alter the efficacy of countercyclical monetary and fiscal policy on Chinese economic activity and inflation. [...]

The traditional relationship between unemployment and output growth known as Okun's law appeared to break down during the Great Recession. This raised the question of whether this rule of thumb was still meaningful as a forecasting tool. However, recent revisions to GDP data show that its relation with unemployment followed a fairly typical cyclical pattern compared with past deep recessions and slow recoveries. The comparatively common patterns suggest that rumors of the death of Okun's law during the Great Recession were greatly exaggerated., Arthur Okun (1962) described the consistent relationship between changes in output and changes in unemployment that has become a standard tool for monetary policymakers and forecasters. The statistical relationship he [...]

Some commentators have questioned whether China's economy slowed more in 2012 than official gross domestic product figures indicate. However, the 2012 reported output and industrial production figures are consistent both with alternative Chinese indicators of the country's economic activity, such as electricity production, and trade volume measures reported by non-Chinese sources. These alternative domestic and foreign sources provide no evidence that China's economic growth was slower than official data indicate., China has been a bright spot in a global economy that is still recovering from the financial crisis that started in 2007. In 2012, China's officially reported gross domestic product [...]

Financial institutions often do not charge explicit fees for the services they provide, but are instead compensated by the spread between interest rates on loans and deposits. The lack of [...]

Total factor productivity--a measure of the efficiency with which labor and capital are used--has fallen during the current recession. But, after adjustment for lower utilization of labor and capital, such [...]

Strong productivity growth is essential for improving living standards and can have an important impact on economic policy, yet economists are far from being experts at predicting when the trend [...]

This Economic Letter summarizes the papers presented at the conference 'Financial Innovations and the Real Economy' held at the Federal Reserve Bank of San Francisco by the Bank's Center for [...]

The sharp slowdown in housing and the inverted yield curve have led to concerns that the odds of a recession have risen. For instance, Dow Jones Newswire reported on November [...]

A familiar old saw about the conduct of monetary policy is that it's like trying to drive a car while looking only in the rearview mirror. The idea is that [...]

Oil prices have increased substantially over the last several years. When oil price increases of this magnitude occurred during the 1970s, they were associated with severe recessions. Why hasn't that [...]