National Economic Indicators - GOIAM...Personal Saving Rate Aug-02-2016 08:37 Jun-2016 10 Household Net Worth Jun-09-2016 12:09 Q1-2016 11 Existing Single-Family Home Sales Jul-21-2016

National Economic Indicators

August 22, 2016

Table of ContentsGDP Release Date Latest Period Page

Table : Real Gross Domestic Product Jul-29-2016 08:30 Q2-2016 4Real Gross Domestic Product Jul-29-2016 08:30 Q2-2016 5Decomposition of Real Gross Domestic Product Jul-29-2016 08:30 Q2-2016 6

HouseholdsRetail Sales Aug-12-2016 08:34 Jul-2016 7Disposable Personal Income and Expenditures Aug-02-2016 08:37 Jun-2016 8Sales of Automobiles and Light Trucks Aug-02-2016 16:14 Jul-2016 9Personal Saving Rate Aug-02-2016 08:37 Jun-2016 10Household Net Worth Jun-09-2016 12:09 Q1-2016 11Existing Single-Family Home Sales Jul-21-2016 10:00 Jun-2016 12New Single-Family Home Sales Jul-26-2016 10:03 Jun-2016 13Private Single-Family Housing Starts & Permits Jul-19-2016 08:32 Jun-2016 14Private Multi-Family Housing Starts & Permits Jul-19-2016 08:32 Jun-2016 15

Business InvestmentReal Investment in Nonresidential Structures Jul-29-2016 08:30 Q2-2016 16Real Private Construction Put in Place Aug-01-2016 10:00 Jun-2016 17Real Nonresidential Fixed Investment Jul-29-2016 08:30 Q2-2016 18Real Investment in Equipment Jul-29-2016 08:30 Q2-2016 19Real Investment in Intellectual Property Jul-29-2016 08:30 Q2-2016 20

TradeBalance of International Trade Aug-05-2016 08:30 Jun-2016 21Exchange Value of the USD Aug-01-2016 10:07 Jul-2016 22

Manufacturing Industrial Production Jul-15-2016 09:16 Jun-2016 23Capacity Utilization Rate: Manufacturing Jul-15-2016 09:16 Jun-2016 24Indexes of Manufacturing Activity Aug-01-2016 10:02 Jul-2016 25Indexes of Non-Manufacturing Activity Aug-03-2016 10:01 Jul-2016 26Table : ISM Business Survey Indexes Aug-01-2016 10:02 Jul-2016 27Manufacturers' New Orders Aug-04-2016 10:03 Jun-2016 28Core Capital Goods Aug-04-2016 10:03 Jun-2016 29Business Inventory/Sales Ratios Aug-09-2016 10:01 Jun-2016 30

Table of Contents (continued)Labor Market Release Date Latest Period Page

Nonfarm Payroll Employment Aug-05-2016 08:31 Jul-2016 31, 32Unemployment Rate Measures Aug-05-2016 08:31 Jul-2016 33,34Labor Market Flows Aug-10-2016 10:03 Jun-2016 35Labor Force Participation Aug-05-2016 08:31 Jul-2016 36Aggregate Weekly Hours Index Aug-05-2016 08:31 Jul-2016 37Average Hourly Earnings Aug-05-2016 08:31 Jul-2016 38Employment Cost Index Jul-29-2016 08:31 Q2-2016 39Business Labor Productivity Aug-09-2016 08:30 Q2-2016 40Unit Labor Costs, Nonfarm Business Aug-09-2016 08:30 Q2-2016 41

InflationTable : Gauges of Inflation Aug-03-2016 11:11 Jul-2016 42Expenditure Price Indexes Aug-02-2016 08:37 Jun-2016 43, 44Consumer Price Indexes Jul-15-2016 08:31 Jun-2016 45Producer Price Indexes Aug-12-2016 08:33 Jul-2016 46Commodity Price Indexes Aug-03-2016 11:11 Jul-2016 47Crude Oil Prices Aug-15-2016 15-Aug-2016 48TIPS Inflation Compensation Aug-12-2016 16:59 05-Aug-2016 49

Monetary Policy & Financial MarketsFederal Reserve System Assets Aug-11-2016 16:31 10-Aug-2016 50Monetary Policy Instruments Aug-14-2016 07:51 12-Aug-2016 51Real Federal Funds Rate Aug-02-2016 08:37 Jul-2016 52FOMC Statement Jun-15-2016 53, 54Eurodollar Futures Aug-15-2016 15-Aug-2016 55SEP: Federal Funds Rate Jun-15-2016 14:05 56Monetary Base Aug-11-2016 16:31 03-Aug-2016 57M2 Aug-11-2016 16:31 Jul-2016 58Money Market Rates Aug-14-2016 07:51 12-Aug-2016 59Capital Market Rates Aug-14-2016 07:51 12-Aug-2016 60Treasury Yield Curve Aug-12-2016 16:27 12-Aug-2016 61Risk Premium Aug-14-2016 07:51 12-Aug-2016 62

4

Real Gross Domestic Product

Source: Bureau of Economic Analysis via Haver Analytics

Q2 Q3 Q4 Q1 Q2CHANGE FROM PREVIOUS QUARTER AT COMPOUND ANNUAL RATE [Percent]:

Gross Domestic Product 2.6 2.0 0.9 0.8 1.2

Personal Consumption Expenditures 2.9 2.7 2.3 1.6 4.2

Nonresidential Fixed Investment 1.6 3.9 -3.3 -3.4 -2.2Structures -2.7 -4.3 -15.2 0.1 -7.9Equipment -0.3 9.1 -2.6 -9.5 -3.5Intellectual Property 8.0 2.1 4.6 3.7 3.5

Residential Fixed Investment 14.9 12.6 11.5 7.8 -6.1

Exports of Goods & Services 2.9 -2.8 -2.7 -0.7 1.4Imports of Goods & Services 2.9 1.1 0.7 -0.6 -0.4

3.2 1.9 1.0 1.6 -0.9

Final Sales to Domestic Purchasers 3.2 3.0 1.7 1.2 2.1

LEVEL IN QUARTER AT SEASONALLY ADJUSTED ANNUAL RATE [Billions of Chained (2005) Dollars]:

Change in Private Inventories 93.8 70.9 56.9 40.7 -8.1

Net Exports of Goods & Services -524.9 -547.1 -566.6 -566.3 -556.3

2015 2016

Government Consumption Expenditures & Gross Investment

-9

-8

-7

-6

-5

-4

-3

-2

-1

0

1

2

3

4

5

6

-9

-8

-7

-6

-5

-4

-3

-2

-1

0

1

2

3

4

5

6

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Percent change from previous quarter at annual rate

Note: Projection is the median, central tendency, and range from the June 2016 Summary of Economic Projections. Red dots indicate median projections. Projections of change in real gross domestic product (GDP) are from the fourth quarter of the previous year to the fourth quarter of the year indicated. 5

Q21.2%

Real Gross Domestic Product

Source: Bureau of Economic Analysis via Haver Analytics & Federal Reserve Board

FOMC Projection

6

Decomposition of Real GDP

Source: Bureau of Economic Analysis and Bureau of Labor Statistics via Haver Analytics

Note: Productivity is calculated as real GDP per employee, from the Household Survey.

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

1958 1962 1966 1970 1974 1978 1982 1986 1990 1994 1998 2002 2006 2010 2014

Employment

Productivity

GDP

10-Year Annual Growth Rates

-14

-12

-10

-8

-6

-4

-2

0

2

4

6

8

10

12

14

16

-14

-12

-10

-8

-6

-4

-2

0

2

4

6

8

10

12

14

16

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

7

12 Month % Change

Retail Sales

Source: Census Bureau via Haver Analytics

3 Month Annualized % Change

Note: Retail sales includes food services.

July2.3%

May. Jun. Jul.Total 0.2 0.8 0.0x Gasoline 0.0 0.7 0.2

Month over Month % Change

-4

-3

-2

-1

0

1

2

3

4

5

6

-4

-3

-2

-1

0

1

2

3

4

5

6

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

8

Disposable Personal Income & Expenditures


12 Month % Change

Real Personal Consumption Expenditure

Real Disposable Personal Income

June

Note: Real disposable personal Income was adjusted to remove tax-induced income shifting near end of 2012.

March April MayIncome 0.3 0.2 0.1Expenditures -0.1 0.8 0.3

Month over Month % Change

4

6

8

10

12

14

16

18

20

4

6

8

10

12

14

16

18

20

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

9

Autos and Light Trucks

Light Trucks

Autos

Sales of Automobiles & Light TrucksMillions of Vehicles

Source: Autodata Corporation via Haver Analytics

July16.7 mil.

2

3

4

5

6

7

8

9

10

2

3

4

5

6

7

8

9

10

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

10

Personal Saving Rate


Percent of disposable personal income

June5.43%

Note: The personal saving rate was adjusted to remove tax-induced income shifting near the end of 2012.

450

500

550

600

650

700

450

500

550

600

650

700

1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016

11

Q1

Household Net WorthPercent of disposable personal income

Source: Z.1 Financial Accounts of the United States via Haver Analytics

2.5

3

3.5

4

4.5

5

5.5

6

6.5

2.5

3

3.5

4

4.5

5

5.5

6

6.5

200020012002200320042005200620072008200920102011201220132014201520162017

12

Existing Single-Family Home Sales

Source: National Association of Realtors via Haver Analytics

Millions of Homes

Average Annual Existing Home Sales: 1990 through 1999

June4.92 mil.

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

1.1

1.2

1.3

1.4

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

1.1

1.2

1.3

1.4

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

13

Average Annual New Home Sales:1990 through 1999

New Single-Family Home Sales


Millions of Homes

June0.55 mil.

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

2.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

2.0

2000 2002 2004 2006 2008 2010 2012 2014 2016

14

Private Single-Family Housing Starts & Permits


Millions of Starts & Permits

Starts

Permits

1990 - 1999 Average Housing Starts

July

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

15

Private Multi-Family Housing Starts & Permits


Millions of Starts & Permits

Starts

Permits

1990 – 1999 Average Multi-Family Starts

July

-35

-30

-25

-20

-15

-10

-5

0

5

10

15

20

25

30

35

-35

-30

-25

-20

-15

-10

-5

0

5

10

15

20

25

30

35

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016


16

Q2-7.9%

Real Investment in Nonresidential Structures


220

270

320

370

420

470

520

570

620

670

220

270

320

370

420

470

520

570

620

670

200020012002200320042005200620072008200920102011201220132014201520162017

17

2009$, Billions

Real Private Nonresidential Construction

June

Real Private Construction Put In Place


Notes: Private nonresidential construction deflated using the price index for private fixed investment in nonresidential structures and private residential construction deflated using the private residential investment chain price index.

Real Private Residential Construction

-30

-25

-20

-15

-10

-5

0

5

10

15

20

-30

-25

-20

-15

-10

-5

0

5

10

15

20

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016


18

Q2-2.3%

Real Nonresidential Fixed Investment


-40

-35

-30

-25

-20

-15

-10

-5

0

5

10

15

20

25

30

35

-40

-35

-30

-25

-20

-15

-10

-5

0

5

10

15

20

25

30

35

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016


19

Q2-3.5%

Real Investment in Equipment


-8

-6

-4

-2

0

2

4

6

8

10

-8

-6

-4

-2

0

2

4

6

8

10

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016


20

Q23.5%

Real Investment in Intellectual Property


-80

-70

-60

-50

-40

-30

-20

-10

0

-80

-70

-60

-50

-40

-30

-20

-10

0

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

21

Current $, Billions

Non-PetroleumBalance

Balance of International Trade


Petroleum Balance

Trade Balance

Note: Customs Value of Trade Balance

June-41.1 Bil.

75

85

95

105

115

125

135

75

85

95

105

115

125

135

1980 1984 1988 1992 1996 2000 2004 2008 2012 2016

22

Exchange Value of the USDIndex, March 1973 = 100

Source: Board of Governors via Haver Analytics

Notes: Measured as the real broad trade-weighted exchange value of the United States Dollar.

July

75

80

85

90

95

100

105

110

115

120

125

130

135

140

75

80

85

90

95

100

105

110

115

120

125

130

135

140

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

23

2012 = 100

July

Industrial Production


Manufacturing

Mining

Overall

62

64

66

68

70

72

74

76

78

80

82

62

64

66

68

70

72

74

76

78

80

82

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

24

Percent

Capacity Utilization Rate: Manufacturing


July75.4

-40

-30

-20

-10

0

10

20

30

40

35

40

45

50

55

60

65

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

25

Diffusion Index, percent

Indexes of Manufacturing Activity

Source: Institute for Supply Management & Richmond Fed via Haver Analytics

ISM (Left Axis)

Richmond Fed (Right Axis)

July53.2

-40

-30

-20

-10

0

10

20

30

40

35

40

45

50

55

60

65

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

26

Diffusion Index, percent

Indexes of Non-Manufacturing Activity

Source: Institute for Supply Management & Richmond Fed via Haver Analytics

ISM (Left Axis)

Richmond Fed Service Sector

Index: Revenues (Right Axis)

July56.5

June July June July

Purchasing Managers Index 53.2 52.6 Non-Manufacturing Index 56.5 55.5

Production 54.7 55.4 Business Activity 59.5 59.3

New Orders 57.0 56.9 New Orders 59.9 60.3

Employment 50.4 49.4 Employment 52.7 51.4

Supplier Deliveries 55.4 51.8 Supplier Deliveries 54.0 51.0

Inventories 48.5 49.5 Inventories 55.5 54.0

Prices 60.5 55.0 Prices 55.5 51.9

Backlog of Orders 52.5 48.0 Backlog of Orders 47.5 51.0

New Export Orders 53.5 52.5 New Export Orders 53.0 55.5

Imports 52.0 52.0 Imports 54.0 53.0

MANUFACTURING BUSINESS: NON-MANUFACTURING BUSINESS:

27DIFFUSION INDEXES: Numbers above 50 percent indicate more favorable responses towards economic activity.

ISM: Business Survey Indexes

Source: Institute for Supply Management via Haver Analytics

300

350

400

450

500

550

600

300

350

400

450

500

550

600

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

28

Current $, Billions

Twelve-Month Moving Average

June

Manufacturers’ New Orders


45

50

55

60

65

70

75

45

50

55

60

65

70

75

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

29

Current $, Billions

Shipments

June

New Orders

Core Capital Goods

Notes: Core capital goods are nondefense capital goods excluding aircraft.


1.1

1.2

1.3

1.4

1.5

1.6

1.7

1.1

1.2

1.3

1.4

1.5

1.6

1.7

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

30

Business Inventory/Sales RatioPercent

Retailers

Total Business

Manufacturers

June


31

Nonfarm Payroll Employment

Source: Bureau of Labor Statistics via Haver Analytics

120

125

130

135

140

145

150

120

125

130

135

140

145

150

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Millions of Persons

July144.44 mil.

32

Nonfarm Payroll Employment


-800

-700

-600

-500

-400

-300

-200

-100

0

100

200

300

400

-800

-700

-600

-500

-400

-300

-200

-100

0

100

200

300

400

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Quarterly average of monthly changes, thousands of persons

Q2Average

July 255Jun 292

May. 24Apr. 144Mar. 186

Monthly Change

33

Unemployment Rate

Source: Bureau of Labor Statistics & Board of Governors via Haver Analytics

Notes: FOMC projection is the median, range, and central tendency for the Q4 levels, from the June 2016 meeting. Red dots indicate median projections

4

4.5

5

5.5

6

6.5

7

7.5

8

8.5

9

9.5

10

10.5

11

4

4.5

5

5.5

6

6.5

7

7.5

8

8.5

9

9.5

10

10.5

11

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Percent

July4.9%

FOMC Projection

34

Measures of Labor Utilization


3

6

9

12

15

18

3

6

9

12

15

18

1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016

Percent

U3: Official Unemployment Rate

U6: U5 + Involuntary Part-Time

U5: U3 + Discouraged + Marginally Attached

July

1

1.5

2

2.5

3

3.5

4

4.5

1

1.5

2

2.5

3

3.5

4

4.5

2000 2002 2004 2006 2008 2010 2012 2014 2016

35

Percent

June

Labor Market Flows

Source: JOLTS via Haver Analytics

Hires Rate*

Job Openings Rate**

Quits Rate*

Note: *Percent of total employment. **Percent of total employment plus job openings.

36

Labor Force Participation


57

58

59

60

61

62

63

64

65

66

67

68

57

58

59

60

61

62

63

64

65

66

67

68

1948 1952 1956 1960 1964 1968 1972 1976 1980 1984 1988 1992 1996 2000 2004 2008 2012 2016

July

Percent of Population

37

Aggregate Weekly Hours Index


90

92

94

96

98

100

102

104

106

90

92

94

96

98

100

102

104

106

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

July

Index, 2007=100

38

Average Hourly Earnings


1.0

1.5

2.0

2.5

3.0

3.5

4.0

1.0

1.5

2.0

2.5

3.0

3.5

4.0

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

July2.6%

12 Month % Change

July 0.3%Jun 0.1%

May. 0.2%Apr. 0.3%Mar. 0.2%

Monthly % Change

1

1.5

2

2.5

3

3.5

4

1

1.5

2

2.5

3

3.5

4

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Employment Cost Index

39

Year over Year % Change

Total Compensation

Wages and Salaries

Q1.2016 YoY % ChangeTotal Comp. 1.9Benefits Cost 1.7

Wages & Salaries 2.0

Benefits Cost

Q2


-2

-1

0

1

2

3

4

5

6

-2

-1

0

1

2

3

4

5

6

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

40


Quarterly Change at Annual Rate

Post-War Average

Labor Productivity, Nonfarm Business


Q2-0.4%

Q2 16 -0.5%Q1 16 -0.6%Q4 15 -2.4%Q3 15 2.0%

-6

-5

-4

-3

-2

-1

0

1

2

3

4

5

6

-6

-5

-4

-3

-2

-1

0

1

2

3

4

5

6

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

41


Alternate Series

Quarterly Change at Annual Rate

Unit Labor Cost, Nonfarm Business

Notes: Alternate series is derived from the Employment Cost Index.


Q22.1%

Q2 16 2.0%Q1 16 -0.2%Q4 15 5.7%Q3 15 0.8%

Expenditure Price Indexes [Percent Change from Previous Month at Annual Rate]:

May June YoY %Personal Consumption Expenditures 2.1 1.2 0.9

Core (excludes Food and Energy) 2.1 0.8 1.6

Consumer Price Indexes [Percent Change from Previous Month at Annual Rate]:

June July YoY %All Items 2.6 -0.5 0.8

Core (excludes Food and Energy) 2.1 1.1 2.2

Producer Price Indexes [Percent Change from Previous Month at Annual Rate]:

June July YoY %Finished Goods 10.5 -5.5 -2.1

Core (excludes Food and Energy) 1.9 -1.8 1.0Core Intermediate Goods 1.9 1.3 -1.7

Crude Goods 38.9 -4.6 -8.8

Spot Commodity Price Index June July YoY %

CRB Spot Commodity Price Index 0.2 -1.2 -0.4

[Percent Change from Previous Month]:

42

Gauges of Inflation

Source: BEA, BLS, & Commodity Research Bureau via Haver Analytics

Notes: Core PCE Price Index includes expenditures on food services.

-1.5

-1

-0.5

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

-1.5

-1

-0.5

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

43

June0.9%

FOMC Projection

Personal Consumption Expenditure Price Index12 Month % Change

Source: Bureau of Economic Analysis & Board of Governors via Haver Analytics

2% Longer-run Target

Notes: FOMC projection is the median, range, and central tendency for Q4/Q4 percent changes, from the June 2016 meeting. Red dots indicate median projections.

-1.5

-1

-0.5

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

-1.5

-1

-0.5

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

44

June1.6%

FOMC Projection

Core Personal Consumption Expenditure Price Index12 Month % Change


2% Longer-run Target

Notes: FOMC projection is the median, range, and central tendency for Q4/Q4 percent changes, from the June 2016 meeting. Red dots indicate median projections. Core PCE Price Index excludes expenditures on gasoline and food services.

-3

-2

-1

0

1

2

3

4

5

6

-3

-2

-1

0

1

2

3

4

5

6

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

45

All Items

Core CPI

July

Consumer Price Indexes12 Month % Change


June JulyCPI: All Items 1.1% 0.9%Core CPI 2.2% 2.2%

-8

-6

-4

-2

0

2

4

6

8

10

12

-8

-6

-4

-2

0

2

4

6

8

10

12

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

46

All Finished Goods

Core Finished Goods

July

Producer Price Indexes12 Month % Change


All Finished Goods -2.1%Core Finished Goods 1.0%

July (percent)

-35-30-25-20-15-10-5051015202530354045

-21-18-15-12-9-6-30369

12151821242730

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

47

PPI Core Intermediate

Goods(Left Axis)

Commodity Research Bureau Spot Commodity

Price Index(Right Axis)

12 Month % Change

Commodity Price Indexes12 Month % Change

Source: Bureau of Labor Statistics & Commodity Research Bureau via Haver Analytics

July

Price Indexes June JulyPPI Core Intermed. Goods -1.9% -1.7%CRBS Spot Commodities -2.9% -0.4%

0

20

40

60

80

100

120

140

160

0

20

40

60

80

100

120

140

160

1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018

Futures Price

Current US$/Barrel

Spot Price22-Aug-16

48

Crude Oil Prices

Source: Financial Times & New York Mercantile Exchange via Haver Analytics & Bloomberg

Notes: Spot and Futures Prices are for Brent Crude Oil.

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

2009 2010 2011 2012 2013 2014 2015 2016

5-Year5 Years Ahead

5-Year

Percent

49

August 12th

TIPS Inflation Compensation

Source: Board of Governors Research Series via Haver Analytics

50

Federal Reserve System Assets


Note: Numbers may not add up due to rounding.

Treasury Securities: $1,652

Treasury Securities: $2,463

Agency MBS: $844

Agency MBS: $1,756

Agency Debt:$87

Agency Debt:$22

Miscellaneous: $282

Miscellaneous: $282

Total: $2,865

Total: $4,524

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

9/12/2012 8/17/2016

$, Billions

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

6.5

7.0

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

6.5

7.0

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Federal Funds Target Rate

Primary Credit Rate

Federal Funds Rate Target RangeInterest Rate Paid on Reserves

Percent

51

August 19th

Monetary Policy Instruments


-3

-2

-1

0

1

2

3

4

-3

-2

-1

0

1

2

3

4

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Percent

52

July

Real Federal Funds Rate


Note: The Real Federal Funds Rate is the difference between the effect Fed Funds rate and the lagged year-over-yearchange in the core PCE price index.

53

FOMC StatementInformation received since the Federal Open Market Committee met in June indicates that the labor market strengthened and that economic activity has been expanding at a moderate rate. Job gains were strong in June following weak growth in May. On balance,payrolls and other labor market indicators point to some increase in labor utilization in recent months. Household spending has been growing strongly but business fixed investment has been soft. Inflation has continued to run below the Committee’s 2 percent longer-run objective, partly reflecting earlier declines in energy prices and in prices of non-energy imports. Market-based measures of inflation compensation remain low; most survey-based measures of longer-term inflation expectations are little changed, on balance, in recent months.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee currently expects that, with gradual adjustments in the stance of monetary policy, economic activity will expand at a moderate pace and labor market indicators will strengthen. Inflation is expected to remain low in the near term, in part because of earlier declines in energy prices, but to rise to 2 percent over the medium term as the transitory effects of past declines in energy and import prices dissipate and the labor market strengthens further. Near-term risks to the economic outlook have diminished. The Committee continues to closely monitor inflation indicators and global economic and financial developments.

Against this backdrop, the Committee decided to maintain the target range for the federal funds rate at 1/4 to 1/2 percent. The stance of monetary policy remains accommodative, thereby supporting further improvement in labor market conditions and a return to 2 percent inflation.

Source: Board of Governors

July 27, 2016

54

Continued…In determining the timing and size of future adjustments to the target range for the federal funds rate, the Committee will assess realized and expected economic conditions relative to its objectives of maximum employment and 2 percent inflation. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments. In light of the current shortfall of inflation from 2 percent, the Committee will carefully monitor actual and expected progress toward its inflation goal. The Committee expects that economic conditions will evolve in a manner that will warrant only gradual increases in the federal funds rate; the federal funds rate is likely to remain, for some time, below levels that are expected to prevail in the longer run. However, the actual path of the federal funds rate will depend on the economic outlook as informed by incoming data.

The Committee is maintaining its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities and of rolling over maturing Treasury securities at auction, and it anticipates doing so until normalization of the level of the federal funds rate is well under way. This policy, by keeping the Committee’s holdings of longer-term securities at sizable levels, should help maintain accommodative financial conditions.

Voting for the FOMC monetary policy action were: Janet L. Yellen, Chair; William C. Dudley, Vice Chairman; LaelBrainard; James Bullard; Stanley Fischer; Loretta J. Mester; Jerome H. Powell; Eric Rosengren; and Daniel K. Tarullo. Voting against the action was Esther L. George, who preferred at this meeting to raise the target range for the federal fundsrate to 1/2 to 3/4 percent.

Source: Board of Governors June 15, 2016

July 26, 2016

August 22, 2016

0

0.5

1

1.5

2

2.5

3

3.5

0

0.5

1

1.5

2

2.5

3

3.5

2016 2017 2018 2019 2020 2021 2022 2023

Percent

55

Eurodollar Futures

Source: CME Group via Bloomberg

56

Summary of Economic Projections: Federal Funds Rate

Source: Board of Governors

Note: Each dot in the chart represents the value of an FOMC participant’s judgment of the midpoint of the appropriate target range (or the appropriate target level) for the federal funds rate at the end of the calendar year. Projections made for the June 2016 meeting.

0

1

2

3

4

5

0

1

2

3

4

5

2016 2017 2018 Longer run

Percent

0

500

1000

1500

2000

2500

3000

3500

4000

4500

0

500

1000

1500

2000

2500

3000

3500

4000

4500

2009 2010 2011 2012 2013 2014 2015 2016

Current $, Billions

57

August 17th

Monetary Base


0

1

2

3

4

5

6

7

8

9

10

11

0

1

2

3

4

5

6

7

8

9

10

11

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

12 Month % Change

58

M2


July7.1%

-0.25

0.00

0.25

0.50

0.75

1.00

1.25

1.50

-0.25

0.00

0.25

0.50

0.75

1.00

1.25

1.50

2009 2010 2011 2012 2013 2014 2015 2016

IOER

Federal Funds Rate

Primary Credit Rate

3-Month LIBOR

3-Month T-BillFed Reverse Repo Rate

on Treasuries

Percent

59

August 17th

Money Market Rates

Source: Board of Governors & Financial Times via Haver Analytics & Bloomberg

0

1

2

3

4

5

6

7

8

9

10

0

1

2

3

4

5

6

7

8

9

10

2009 2010 2011 2012 2013 2014 2015 2016

10-Year TreasuryBond Rate

Corporate AAABond Rate

Corporate BBBBond Rate

30-YearConventional

Mortgage Rate

Percent

60

August 19th

Capital Market Rates

Source: BofA Merrill Lynch & Board of Governors via Haver Analytics

61

Treasury Yield Curve


0.00

0.25

0.50

0.75

1.00

1.25

1.50

1.75

2.00

2.25

2.50

0.00

0.25

0.50

0.75

1.00

1.25

1.50

1.75

2.00

2.25

2.50

6 M 2 Yrs 3 Yrs 5 Yrs 7 Yrs 10 Yrs

July 26, 2016 August 19, 2016

Percent

Time to Maturity

0

1

2

3

4

5

6

7

8

0

1

2

3

4

5

6

7

8

2009 2010 2011 2012 2013 2014 2015 2016

10 Year Rolling Average Risk Premium

Percent

62

Risk Premium

Source: BofA Merrill Lynch & Board of Governors via Haver Analytics

August 19th

Note: Risk Premium is defined as the difference in yields between BofA Merrill Lynch BBB and 10-year Treasury.

Documents

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