Partly because of the effects of the COVID-19 pandemic, inflation and record deficit spending have been in the news lately. And as the first figure shows, the U.S. debt-to-GDP ratio is at unprecedented levels and the U.S. inflation rate is higher than it has been in decades. This blog post explains the relation between nominal debt and inflation, using government debt as an example.

While a surprising burst of inflation immediately reduces the real value of a borrower’s debt burden—transferring wealth from lenders to borrowers—it is also likely to raise future borrowing costs because investors will then expect higher inflation and demand higher nominal yields on debt to compensate them for the expected loss of purchasing power and the associated uncertainty.

A group of women at the Federal Reserve Bank of St. Louis was prompted to act after attending virtual seminars in 2020 and hearing statistics about women in STEAM.

But let’s start with, what is STEAM? It is the study of and careers in the fields of science, technology, engineering, arts and mathematics. Members of the St. Louis Fed’s VIEW (Valuing, Inspiring, Empowering Women) employee resource group learned that the number of women in STEAM was decreasing, and a high percentage of women were leaving their chosen STEAM career after about five years.

Suddenly, the text messages started flowing between VIEW members. What can we do? How can we have a bigger impact? What are we dealing with here at the St. Louis Fed? Some VIEW members, who are also executives in information technology and executive offices at the St. Louis Fed, went to work to impact the presence of women in STEAM at the Bank.

Here’s a look at the...

Beginning in May 2021, 26 U.S. governors announced that their states would end some or all participation in pandemic-related emergency unemployment benefits (EUB) ahead of the federal programs’ September expiration. At the time, some of these governors echoed the concerns of business owners in their states that generous EUB were contributing to difficulties filling job vacancies, which were nearing all-time highs. Twenty-four of the 26 states halted their participation between June 12 and July 3.

The EUB programs were historic, extending the number of weeks individuals could receive benefits, adding $600 per week (later reduced to $300 per week) to recipients’ baseline benefits, and expanding program eligibility to contract and gig workers, who would otherwise not be covered. Many recipients of these enhanced benefits saw a more than one-for-one replacement rate on lost earnings. By contrast, typical pre-pandemic unemployment...

In October 2021, 136 countries signed a global tax deal that, among other points, established a minimum corporate tax rate of 15%. The goals of the deal were to end the race to the bottom of corporate taxation—i.e., end international competition on corporate taxes to attract foreign investment—and avoid profit-shifting practices by which multinational corporations in high-tax jurisdictions book the excess profits in low-tax jurisdictions, creating a disconnect between the location of the profits and the location of real activity. This global tax deal is one of the most ambitious international tax reforms, and it requires substantial coordination across countries.

There is a strong incentive for the United States to support the deal. The most obvious impact of profit shifting is lost tax revenues. However, profit shifting has sizable economic consequences on the U.S. economy apart from just revenues. Offshore profits are not part of...

The St. Louis Fed provides a variety of paid internships for undergraduate and graduate students. Most assignments are project-based. In addition to work experience, Bank internships also provide mentoring, networking and training opportunities to benefit students’ personal and professional development. Interns will gain exposure to a variety of business areas in the Bank.

Firms with more than 500 employees were ineligible for Paycheck Protection Program (PPP) loans, making it important to analyze the changes in employment by firms that were and were not eligible. The pandemic hit small firms, which generally have a smaller financial cushion, harder—especially those in service sectors impacted by social distancing policies and other measures aimed at curtailing the virus’s spread.

A version of this opinion piece first appeared in the St. Louis Post-Dispatch on June 9 and in the St. Louis American on June 10.

Along with personal isolation during the pandemic, many St. Louisans experienced significant financial and emotional challenges. Servers, barbers, cooks, hotel staff and many others couldn’t perform their work or practice their craft while at home, yet they still had to pay their families’ bills.

As a partial response to these challenges, private lenders and the government enacted myriad financial support policies as assistance. One tool was debt relief: Student loan, mortgage, credit card and auto payments were in some instances postponed. Taken together, these policies shielded many people from the financial devastation that was feared at the outset of the crisis. The worst of the pandemic is hopefully behind us, and the economy appears stronger in many ways. However, with many forms of debt...

In October 2021, 136 countries signed a global tax deal that, among other points, established a minimum corporate tax rate of 15%. The goals of the deal were to end the race to the bottom of corporate taxation—i.e., end international competition on corporate taxes to attract foreign investment—and avoid profit-shifting practices by which multinational corporations in high-tax jurisdictions book the excess profits in low-tax jurisdictions, creating a disconnect between the location of the profits and the location of real activity. This global tax deal is one of the most ambitious international tax reforms, and it requires substantial coordination across countries.

There is a strong incentive for the United States to support the deal. The most obvious impact of profit shifting is lost tax revenues. However, profit shifting has sizable economic consequences on the U.S. economy apart from just revenues. Offshore profits are not part of...

It’s natural to want to know where you stand in the economy and get ahead of any big changes. It’s no surprise, then, that we’re hearing plenty of talk about whether the U.S. economy is in a recession.

As usual, we begin our inquiry with FRED data! The graph above displays, month after month, the estimated probabilities that the U.S. economy is in recession. These estimates are calculated from a set of economic statistics discussed in this article. The FRED graph also conveniently displays shaded bars when actual recessions occurred, as determined by the NBER business cycle dating committee. And the match up is astonishingly good! (For a deeper analysis, see this article.)

So, are we in a recession or not? You can judge for yourself; but at the time of this writing, the June 2022 data do not seem to indicate a recession.

Keep in mind that economic data can take a little while to arrive, conditions can quickly change, and our current economic...

In October 2021, 136 countries signed a global tax deal that, among other points, established a minimum corporate tax rate of 15%. The goals of the deal were to end the race to the bottom of corporate taxation—i.e., end international competition on corporate taxes to attract foreign investment—and avoid profit-shifting practices by which multinational corporations in high-tax jurisdictions book the excess profits in low-tax jurisdictions, creating a disconnect between the location of the profits and the location of real activity. This global tax deal is one of the most ambitious international tax reforms, and it requires substantial coordination across countries.

There is a strong incentive for the United States to support the deal. The most obvious impact of profit shifting is lost tax revenues. However, profit shifting has sizable economic consequences on the U.S. economy apart from just revenues. Offshore profits are not part of...

Emergency unemployment benefits were introduced early in the COVID-19 pandemic to ease its impact on the U.S. labor market. Over the next year, employment recovered considerably. A 2022 working paper from this article’s authors found that terminating emergency unemployment benefit programs caused a substantial increase in employment. An extension of the working paper’s analysis showed that halting these programs affected the employment of younger and older workers differently.

The euro hit “parity” with the U.S. dollar for the first time in nearly 20 years on Wednesday, July 13, 2022. That is, the exchange rate dropped to $1.00 per euro. It quickly rebounded and has been hovering around $1.02 at of the time of this writing. What are the forces behind these changes, and how might we use data to illustrate them?

Interest rate parity theory suggests that the interest rate in the U.S. should equal the interest rate in the eurozone, plus the expected depreciation of U.S. currency. The basic assumption underlying this theory is that there is no arbitrage between deposits in different currencies. Thus, if interest rates are higher in the U.S. than in the eurozone, then it has to be the case that the dollar will eventually depreciate (i.e., lose value) vis-à-vis the euro. If markets are expecting the U.S. dollar to depreciate tomorrow, today’s value tends to be high. Thus, exchange rates tend to broadly follow movements in the difference...

Beginning in May 2021, 26 U.S. governors announced that their states would end some or all participation in pandemic-related emergency unemployment benefits (EUB) ahead of the federal programs’ September expiration. At the time, some of these governors echoed the concerns of business owners in their states that generous EUB were contributing to difficulties filling job vacancies, which were nearing all-time highs. Twenty-four of the 26 states halted their participation between June 12 and July 3.

The EUB programs were historic, extending the number of weeks individuals could receive benefits, adding $600 per week (later reduced to $300 per week) to recipients’ baseline benefits, and expanding program eligibility to contract and gig workers, who would otherwise not be covered. Many recipients of these enhanced benefits saw a more than one-for-one replacement rate on lost earnings. By contrast, typical pre-pandemic unemployment...

“FRED is basically a trusted source of economic data,” says Katrina Stierholz, group vice president who oversees FRED at the Federal Reserve Bank of St. Louis. She is joined by Carlos Garriga, senior vice president and research director; Keith Taylor, FRED data officer; and Yvetta Fortova, FRED product owner; in a discussion with Federal Reserve System Chief Innovation Officer Sunayna Tuteja. Listen to the FRED team share the history of this economic data, how they focus on the experiences of FRED users and share their favorite FRED data sets.

Beginning in May 2021, 26 U.S. governors announced that their states would end some or all participation in pandemic-related emergency unemployment benefits (EUB) ahead of the federal programs’ September expiration. At the time, some of these governors echoed the concerns of business owners in their states that generous EUB were contributing to difficulties filling job vacancies, which were nearing all-time highs. Twenty-four of the 26 states halted their participation between June 12 and July 3.

The EUB programs were historic, extending the number of weeks individuals could receive benefits, adding $600 per week (later reduced to $300 per week) to recipients’ baseline benefits, and expanding program eligibility to contract and gig workers, who would otherwise not be covered. Many recipients of these enhanced benefits saw a more than one-for-one replacement rate on lost earnings. By contrast, typical pre-pandemic unemployment...

It’s natural to want to know where you stand in the economy and get ahead of any big changes. It’s no surprise, then, that we’re hearing plenty of talk about whether the U.S. economy is in a recession.

As usual, we begin our inquiry with FRED data! The graph above displays, month after month, the estimated probabilities that the U.S. economy is in recession. These estimates are calculated from a set of economic statistics discussed in this article. The FRED graph also conveniently displays shaded bars when actual recessions occurred, as determined by the NBER business cycle dating committee. And the match up is astonishingly good! (For a deeper analysis, see this article.)

So, are we in a recession or not? You can judge for yourself; but at the time of this writing, the June 2022 data do not seem to indicate a recession.

Keep in mind that economic data can take a little while to arrive, conditions can quickly change, and our current economic...