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{"results":[{"title":"Which businesses are using AI technology?","permalink":"https://fred.stlouisfed.org/blog/2026/10/which-businesses-are-using-ai-technology","date":"2026-10-19 08:00:00","content":"&lt;iframe src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1ZCpn&amp;amp;width=670&amp;amp;height=475&quot; scrolling=&quot;no&quot; frameborder=&quot;0&quot; style=&quot;overflow:hidden; width:670px; height:525px;&quot; allowtransparency=&quot;true&quot; loading=&quot;lazy&quot;&gt;&lt;/iframe&gt;
&lt;h2&gt;The takeaway&lt;/h2&gt;
&lt;p&gt;According to the Ramp AI Index, as of September 2026, more than half of all businesses paid for an artificial intelligence (AI) product or service. Adoption rates jumped in the months after ChatGPT&#39;s public launch in late 2022 and have risen steadily since.&lt;/p&gt;
&lt;h2&gt;The data&lt;/h2&gt;
&lt;p&gt;Ramp calculates the adoption index by using firms&#39; corporate spending on services from AI companies to estimate adoption rates overall and by provider, industry, and company size. FRED recently added 14 data series from &lt;a href=&quot;https://fred.stlouisfed.org/release?rid=23”&quot;&gt;this source&lt;/a&gt;.&lt;/p&gt;
&lt;h2&gt;Some insights&lt;/h2&gt;
&lt;p&gt;&lt;em&gt;&lt;a href=&quot;https://fred.stlouisfed.org/graph/?g=1ZCpA&quot;&gt;Adoption by business size&lt;/a&gt;&lt;/em&gt;: AI adoption has climbed for businesses of every size, although it is spreading fastest at bigger and medium-sized companies. Adoption among small-sized businesses has grown steadily, but they lag the other two groups.&lt;/p&gt;
&lt;p&gt;&lt;em&gt;&lt;a href=&quot;https://fred.stlouisfed.org/graph/?g=1ZCpE&quot;&gt;Adoption by industry&lt;/a&gt;&lt;/em&gt;: Industry matters much more than size. The information sector, which includes software and publishing, has consistently recorded the highest adoption rates since 2023, with finance and insurance close behind. Other industries, in decreasing order of AI adoption are manufacturing, retail trade, health care and social assistance, construction, and accommodation and food services. &lt;/p&gt;
&lt;p&gt;&lt;em&gt;&lt;a href=&quot;https://fred.stlouisfed.org/graph/?g=1ZCpI&quot;&gt;Adoption by provider&lt;/a&gt;&lt;/em&gt;: A business can pay for AI products and services offered by more than one provider, so the adoption shares reported by Ramp don&#39;t match the overall adoption rate. OpenAI surged in the first months of 2023 and kept rising through most of 2025, but it has leveled off since then. Anthropic gained ground steadily from 2024 on. Its growth accelerated sharply in early 2026, and at the time of this writing it has become the most widely paid-for of the providers tracked. A third provider, xAI, remains much smaller.&lt;/p&gt;
&lt;h2&gt;Some caveats&lt;/h2&gt;
&lt;p&gt;These data series don&amp;rsquo;t reflect employees using free AI tools (such as Google&#39;s Gemini), AI features built into other software, or the intensity of use of those tools and features (which is measured by spending on tokens). Details about how closely the Ramp index reflects business practices across the US can be obtained by examining the notes provided under the FRED graphs.&lt;/p&gt;
&lt;p&gt;&lt;strong&gt;How this graph was created&lt;/strong&gt;: Search &lt;a href=&quot;https://fred.stlouisfed.org/&quot;&gt;FRED&lt;/a&gt; for and select &amp;ldquo;Artificial Intelligence Adoption by Ramp Businesses: Overall.&amp;rdquo; Click the &amp;ldquo;Edit Graph&amp;rdquo; button and select the &amp;ldquo;Add Line&amp;rdquo; tab to search for &amp;ldquo;Artificial Intelligence Adoption by Ramp Businesses: Company Size: Large Businesses.&amp;rdquo; Don&amp;rsquo;t forget to click &amp;ldquo;Add data series.&amp;rdquo; Repeat this last step to search for and add the other two series: &amp;ldquo;Artificial Intelligence Adoption by Ramp Businesses: Company Size: Medium-Sized Businesses&amp;rdquo; and &amp;ldquo;Artificial Intelligence Adoption by Ramp Businesses: Company Size: Small-Sized Businesses.&amp;rdquo;&lt;/p&gt;
&lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/research/information-services#diego&quot;&gt;Diego Mendez-Carbajo&lt;/a&gt;.&lt;/p&gt;","additional_content":""},{"title":"Is the Treasury convenience yield rebounding?","permalink":"https://fred.stlouisfed.org/blog/2026/10/Is-the-Treasury-convenience-yield-rebounding","date":"2026-10-15 08:00:00","content":"&lt;p&gt;&lt;iframe src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1Z5gW&amp;amp;width=670&amp;amp;height=475&quot; scrolling=&quot;no&quot; frameborder=&quot;0&quot; style=&quot;overflow:hidden; width:670px; height:525px;&quot; allowtransparency=&quot;true&quot; loading=&quot;lazy&quot;&gt;&lt;/iframe&gt;&lt;/p&gt;
&lt;h2&gt;The takeaway&lt;/h2&gt;
&lt;p style=&quot;margin-bottom: 11pt;&quot;&gt;&lt;strong&gt;&lt;span style=&quot;line-height: 102%;&quot;&gt;&lt;/span&gt;&lt;/strong&gt;&lt;strong&gt;&lt;span style=&quot;line-height: 102%;&quot;&gt;&lt;/span&gt;&lt;/strong&gt;&lt;span style=&quot;line-height: 102%;&quot;&gt;The spread between AAA corporate bonds and Treasuries has widened since October 2025, suggesting a partial recovery in the Treasury convenience yield.&lt;/span&gt;&lt;/p&gt;
&lt;h2&gt;The details&lt;/h2&gt;
&lt;p&gt;&lt;span style=&quot;line-height: 102%;&quot;&gt;US Treasury securities offer investors benefits beyond their interest payments, including safety and the ability to trade easily. Investors&amp;rsquo; willingness to accept lower yields in exchange for these benefits is known as the Treasury convenience yield. &lt;/span&gt;&lt;/p&gt;
&lt;p&gt;&lt;span style=&quot;line-height: 102%;&quot;&gt;The FRED graph shows one proxy for this convenience yield: the option-adjusted spread of the ICE BofA AAA U.S. Corporate Index. This measure compares yields on the highest-rated corporate bonds with a Treasury yield curve, adjusting for options embedded in the corporate bonds. Since April 2026, FRED has limited this series to the most recent three years of observations, so we turn to an earlier analysis for historical context.&lt;/span&gt;&lt;/p&gt;
&lt;p&gt;&lt;span style=&quot;line-height: 102%;&quot;&gt;A &lt;/span&gt;&lt;a href=&quot;https://www.stlouisfed.org/on-the-economy/2025/oct/are-u-s-treasuries-still-convenient&quot;&gt;&lt;span style=&quot;line-height: 102%; color: #0563c1;&quot;&gt;post from October 2025&lt;/span&gt;&lt;/a&gt;&lt;span style=&quot;line-height: 102%;&quot;&gt;&amp;nbsp;documented a decline in the spread over the preceding years. It averaged 67 basis points during 2012-19, compared with 36 basis points from the beginning of 2025 through October 8, 2025. The green dashed line marks the spread&amp;rsquo;s value on that date: 30 basis points, or 0.30 percentage points.&lt;/span&gt;&lt;/p&gt;
&lt;p&gt;&lt;span style=&quot;line-height: 102%;&quot;&gt;Since then, the spread has widened, although unevenly. It reached 45 basis points in March 2026, narrowed to 32 basis points in May, and rose to 46 basis points in July. On September 25, it stood at 41 basis points: 11 basis points above the October 2025 benchmark, but still below the 2012-19 average.&lt;/span&gt;&lt;/p&gt;
&lt;p&gt;&lt;span style=&quot;line-height: 102%;&quot;&gt;These movements suggest a partial recovery in the Treasury convenience yield. However, the spread also reflects &lt;/span&gt;&lt;a href=&quot;https://www.stlouisfed.org/on-the-economy/2020/april/effects-covid-19-monetary-policy-response-corporate-bond-market&quot;&gt;&lt;span style=&quot;line-height: 102%; color: #0563c1;&quot;&gt;corporate credit risk and liquidity conditions&lt;/span&gt;&lt;/a&gt;&lt;span style=&quot;line-height: 102%;&quot;&gt;, so its increase cannot be attributed entirely to changes in the benefits of holding Treasuries.&lt;/span&gt;&lt;/p&gt;
&lt;p&gt;&lt;span style=&quot;line-height: 102%;&quot;&gt;&lt;strong&gt;How this graph was created&lt;/strong&gt;: Search &lt;a href=&quot;https://fred.stlouisfed.org/&quot;&gt;FRED&lt;/a&gt; for &quot;AAA Corporate Spread&quot; and the relevant series should be the first. Click on &quot;Edit Graph&quot; and open the &quot;Add Line&quot; tab. Click on &quot;Create user-defined line&quot; and add a horizontal line at 0.30.&lt;/span&gt;&lt;/p&gt;
&lt;p&gt;&lt;span style=&quot;line-height: 102%;&quot;&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/research/economists/kozlowski&quot;&gt;Julian Kozlowski&lt;/a&gt; and &lt;a href=&quot;https://www.stlouisfed.org/research/research-associates&quot;&gt;Nicholas Sullivan&lt;/a&gt;.&lt;br /&gt;
&lt;/span&gt;&lt;/p&gt;","additional_content":""},{"title":"Assets across pension types","permalink":"https://fred.stlouisfed.org/blog/2026/10/assets-across-pension-types","date":"2026-10-08 08:00:00","content":"&lt;iframe src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1Z8Mv&amp;amp;width=670&amp;amp;height=475&quot; scrolling=&quot;no&quot; frameborder=&quot;0&quot; style=&quot;overflow:hidden; width:670px; height:525px;&quot; allowtransparency=&quot;true&quot; loading=&quot;lazy&quot;&gt;&lt;/iframe&gt;
&lt;h2&gt;The takeaway&lt;/h2&gt;
&lt;p&gt;Assets backing private-sector &lt;em&gt;defined contribution&lt;/em&gt;&amp;nbsp;pensions have grown far more than those for&amp;nbsp;private-sector &lt;em&gt;defined benefit&lt;/em&gt;&amp;nbsp;pensions. But defined contribution pension assets are also far more volatile.&lt;/p&gt;
&lt;h2&gt;DC versus DB pensions&lt;/h2&gt;
&lt;p&gt;Defined contribution (DC) pensions&amp;mdash;such as 401(k)s&amp;mdash;are investment accounts that both an employee and their employer contribute to. The employee allocates the investments in the account and can make withdrawals from it when they retire. In our FRED graph above, the solid line shows the total value of financial assets in these DC accounts.&lt;/p&gt;
&lt;p&gt;Defined benefit (DB) pensions&amp;mdash;such as traditional pensions that pay a fixed income when the employee retires&amp;mdash;are backed by assets that employers select and manage. In our FRED graph above, the dashed line shows the total value of financial assets that fund these DB pensions.
&lt;/p&gt;
&lt;h2&gt;Why the gap is growing&lt;/h2&gt;
&lt;p&gt;Our FRED graph also shows that the gap in asset value between the two pension types has grown increasingly wide since late 2021. Between 2021 Q4 and 2026 Q2, DC assets grew from $9.20 trillion to $12.27 trillion, while DB assets fell from $3.68 trillion to $3.07 trillion over the same period. This disparity in asset value likely doesn&#39;t reflect differing enrollment in DC versus DB pensions.&lt;/p&gt;
&lt;p&gt;&lt;a href=&quot;https://www.stlouisfed.org/on-the-economy/2025/mar/pension-401k-retirement-plan-trends-us-workplace&quot;&gt;Recent research&lt;/a&gt; shows that, while enrollment in DC pensions is four times greater than enrollment in DB pensions, the enrollment gap has held steady since 2013. Instead, the greater value of DC pension assets can probably be attributed to the different investment distributions between the pension types.&lt;/p&gt;
&lt;p&gt;Employees with DC pensions want to maximize their income in retirement, so they invest in assets such as stocks, which are riskier but offer higher returns. On the other hand, employers responsible for DB pensions want to ensure they can fulfill their obligations to their former employees, so they make much safer investments into lower-return assets, such as bonds.
&lt;/p&gt;
&lt;h2&gt;Higher returns bring higher risks&lt;/h2&gt;
&lt;p&gt;Households&amp;rsquo; riskier investments in their DC pensions expose them more to the business cycle, meaning the value of their collective investments can fall during recessions. Take the Great Recession period, from 2007 Q3 to 2009 Q1, as an example: The value of DC pension assets fell 30%, from $3.73 trillion to $2.60 trillion. By contrast, the safer investments employers make for DB pensions insulate them from larger fluctuations, allowing them to grow their funds even when the broader economy contracts. Over the same example period, DB pension assets actually grew 5%, from $2.46 trillion to $2.58 trillion.&lt;/p&gt;
&lt;p&gt;&lt;strong&gt;How this graph was created&lt;/strong&gt;: Search &lt;a rel=&quot;noopener noreferrer&quot; href=&quot;https://fred.stlouisfed.org&quot; target=&quot;_blank&quot;&gt;FRED&lt;/a&gt; for &amp;ldquo;Private Defined Contribution Pension Financial Assets.&amp;rdquo; Select &amp;ldquo;Private Defined Contribution Pension Funds; Total Financial Assets, Level (BOGZ1FL574090055Q)&amp;rdquo;. Then select &amp;ldquo;Edit Graph,&amp;rdquo; go to the &amp;ldquo;Add Line&amp;rdquo; tab, search for &amp;ldquo;Private Defined Benefit Pension Funds; Total Financial Assets, Level,&amp;rdquo; and select the top result (which should have the series ID &amp;ldquo;BOGZ1FL574090045Q&amp;rdquo;). Click &amp;ldquo;Add data series&amp;rdquo; to add the defined benefit asset series to the existing defined contribution asset series.
&lt;/p&gt;
&lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/research/economists/chiang&quot;&gt;Yu-Ting Chiang&lt;/a&gt; and &lt;a href=&quot;https://www.stlouisfed.org/research/research-associates&quot;&gt;Collin Eldridge&lt;/a&gt;.&lt;/p&gt;","additional_content":""},{"title":"Connect your AI assistant to FRED","permalink":"https://fred.stlouisfed.org/blog/2026/10/connect-your-ai-assistant-to-FRED","date":"2026-10-04 08:35:00","content":"&lt;p&gt;&amp;nbsp;&lt;/p&gt;
&lt;p&gt;&lt;img alt=&quot;FRED&#39;s MCP connector&quot; src=&quot;-/media/C552EF500A574691BB2B831AF9B34893.ashx?h=208&amp;amp;w=1320&quot; style=&quot;max-width: 100%;&quot; /&gt;&lt;/p&gt;
&lt;h2&gt;The takeaway&lt;/h2&gt;
&lt;p&gt;AI assistants can now talk directly to FRED through its new MCP connector to generate reliable answers, accurate charts, and complete data downloads.&lt;/p&gt;
&lt;h2&gt;FRED&amp;rsquo;s new AI connector&lt;/h2&gt;
&lt;p&gt;AI assistants can now connect directly to FRED&amp;rsquo;s trusted repository of economic data with a new tool built on the model context protocol (MCP), an open standard for linking AI tools to data sources. &lt;a href=&quot;https://fred.stlouisfed.org/help/data/connecting-fred-to-ai-services/FRED-MCP-Connector&quot;&gt;Full details here&lt;/a&gt;.&lt;/p&gt;
&lt;h2&gt;How does it work?&lt;/h2&gt;
&lt;p&gt;With the MCP connector, AI assistants such as Claude and ChatGPT can send a request for information directly to FRED, receive the data, and turn it into a plain-spoken answer using five different tools:
&lt;/p&gt;
&lt;ul&gt;
    &lt;li&gt;Searching for data
    &lt;/li&gt;
    &lt;li&gt;Inspecting the metadata and methodology notes
    &lt;/li&gt;
    &lt;li&gt;Retrieving observations with date ranges and transformations
    &lt;/li&gt;
    &lt;li&gt;Generating CSV or JSON download links with the data
    &lt;/li&gt;
    &lt;li&gt;Rendering the immediately recognizable FRED graphs linked back to fred.stlouisfed.org&lt;/li&gt;
&lt;/ul&gt;
&lt;p&gt;&amp;nbsp;&lt;/p&gt;
&lt;h2&gt;Continued confidence in the data&lt;/h2&gt;
&lt;p&gt;The FRED team&amp;rsquo;s commitment to data integrity and accessibility is not changing. FRED is simply being enhanced to match the way people are now searching for answers to their data questions. After installing the FRED MCP connector, you can ask your AI assistant questions about economic data and feel confident the source of that data is the same trusted source people have been using since 1991.&lt;/p&gt;
&lt;p&gt;&lt;em&gt;&quot;How has unemployment changed since the start of the year?&quot;&lt;/em&gt;
The AI assistant searches FRED, finds the headline series, pulls the actual data, and answers in plain language.&lt;/p&gt;
&lt;p&gt;&lt;em&gt;&amp;ldquo;What is year-over-year consumer price inflation?&amp;rdquo;&lt;/em&gt;
The AI assistant applies the data transformation for you, from an index value to a year-over-year value, and supplies the answer.&lt;/p&gt;
&lt;p&gt;&lt;em&gt;&amp;ldquo;Compare mortgage rates with the 10-year Treasury yield.&amp;rdquo;&lt;/em&gt;
The AI assistant renders and provides a FRED graph for you that displays both of these time series.&lt;/p&gt;
&lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/research/information-services#scott&quot;&gt;Scott St. Louis&lt;/a&gt; and &lt;a href=&quot;https://www.stlouisfed.org/research/information-services#diego&quot;&gt;Diego Mendez-Carbajo&lt;/a&gt;.&lt;/p&gt;","additional_content":""},{"title":"Real GDP by state: Second quarter 2026 ","permalink":"https://fred.stlouisfed.org/blog/2026/10/real-gdp-by-state-second-quarter-2026","date":"2026-10-01 09:14:00","content":"&lt;div class=&quot;embed-map&quot; style=&quot;width: 670px; height: 720px; overflow: visible;&quot;&gt;&lt;iframe style=&quot;overflow: visible !important; width: 670px; height: 720px !important;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?m=1Z8iL&amp;width=670&amp;amp;height=640&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/div&gt;
&lt;p&gt;On September 30, 2026, the Bureau of Economic Analysis (BEA) released real GDP data for all US states for the second quarter of 2026. The FRED map above shows the annualized growth rates from the previous quarter: Red denotes contraction (0% or less growth), light green denotes slow growth (&amp;gt;0% to 2%), and dark green denotes stronger growth (&amp;gt;2% to 5%).&lt;/p&gt;
&lt;h2&gt;Highlights&lt;/h2&gt;
&lt;ul&gt;
    &lt;li&gt;44 of 50 state economies plus Washington, DC, grew in the second quarter. The national average was at &lt;a href=&quot;https://fred.stlouisfed.org/graph/?g=1Z8en&quot;&gt;2.2%&lt;/a&gt; annualized growth.&lt;/li&gt;
    &lt;li&gt;The median state, Iowa, grew at 1.7%, which is below the national average. 32 states had slower growth than the national average.&lt;/li&gt;
    &lt;li&gt;New York had the fastest annualized growth, at 4%. South Carolina and Delaware were next, at 3.5% growth.&lt;/li&gt;
    &lt;li&gt;Alaska, Kansas, Nebraska, North Dakota, West Virginia, and Wyoming all experienced a contraction. West Virginia had the steepest contraction, at -2.3%, followed by Wyoming, at -1.6%.&lt;/li&gt;
&lt;/ul&gt;
&lt;p&gt;According to the BEA press &lt;a href=&quot;https://www.bea.gov/news/2026/gdp-third-estimate-industries-corporate-profits-state-gdp-and-state-personal-income-2nd&quot;&gt;release&lt;/a&gt;, finance and insurance sectors were the leading contributors to the increase in real GDP in New York and Delaware. Mining was the leading contributor to the decline in West Virginia and Wyoming. More information on each state&amp;rsquo;s breakdown of their overall composition of real GDP can be found &lt;a href=&quot;https://apps.bea.gov/itable/?ReqID=70&amp;amp;step=1&amp;amp;_gl=1*cq75fo*_ga*MTAxMDM2ODYxMi4xNzY0NjA3OTQz*_ga_J4698JNNFT*czE3NzQzNzAzNjMkbzE4JGcxJHQxNzc0MzcwMzY4JGo1NSRsMCRoMA..#eyJhcHBpZCI6NzAsInN0ZXBzIjpbMSwyOSwyNSwzMSwyNiwyNywzMF0sImRhdGEiOltbIlRhYmxlSWQiLCI1MjkiXSxbIk1ham9yX0FyZWEiLCIwIl0sWyJTdGF0ZSIsWyIwIl1dLFsiQXJlYSIsWyJYWCJdXSxbIlN0YXRpc3RpYyIsWyItMSJdXSxbIlVuaXRfb2ZfbWVhc3VyZSIsIkxldmVscyJdLFsiWWVhciIsWyIyMDI2IiwiMjAyNSIsIjIwMjQiXV0sWyJZZWFyQmVnaW4iLCItMSJdLFsiWWVhcl9FbmQiLCItMSJdXX0=&quot;&gt;here&lt;/a&gt;.&lt;/p&gt;
&lt;p&gt;The St. Louis Fed&amp;rsquo;s Eighth District states grew in the second quarter, with all eight growing slower than the national average. Mississippi and Illinois grew the fastest, at 2.1%.&lt;/p&gt;
&lt;p&gt;&lt;strong&gt;Note:&lt;/strong&gt; These data are subject to future revision by the source, with an annual revision the following March. Our &lt;a href=&quot;https://alfred.stlouisfed.org/graph/?g=1Z8cq&quot;&gt;ALFRED database&lt;/a&gt; records vintages of the data, so users can view the data as they appeared at various points in history. The link takes you to real GDP for Missouri, as of September 30, 2026.&lt;/p&gt;
&lt;p&gt;Highlights for Q1 growth revisions are as follows:&lt;/p&gt;
&lt;ul&gt;
    &lt;li&gt;Q1 revisions averaged &amp;nbsp;+/- 2% across all states and Washington, DC.&lt;/li&gt;
    &lt;li&gt;The largest downward revision was for Alaska: from 2.8% to -3.8%.&lt;/li&gt;
    &lt;li&gt;The largest upward revision was for Washington, DC: from 2.2% to 7.3%.&lt;/li&gt;
&lt;/ul&gt;
&lt;p&gt;&lt;strong&gt;How this map was created&lt;/strong&gt;: Search &lt;a href=&quot;https://fred.stlouisfed.org&quot;&gt;FRED&lt;/a&gt; for &amp;ldquo;Real Total Gross Domestic Product for Missouri&amp;rdquo; and click the first available series. Click the &amp;ldquo;View Map&amp;rdquo; button and then the blue &amp;ldquo;Edit Map&amp;rdquo; button. Modify the units to &amp;ldquo;Compounded Annual Rate of Change.&amp;rdquo; Use &amp;ldquo;Format&amp;rdquo; to switch the number of color groups to 3, with the data grouped by &amp;ldquo;User Defined Method&amp;rdquo;; then define the scales to be 2 and 10. For values 0 or less, choose red for contraction; for values 2 or less, choose light green to show slight growth; for values 5 or less, choose dark green to show moderate growth.&lt;/p&gt;
&lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/research/research-associates&quot;&gt;John Fuller&lt;/a&gt; and &lt;a href=&quot;https://www.stlouisfed.org/research/economists/gascon&quot;&gt;Charles Gascon&lt;/a&gt;.&lt;/p&gt;","additional_content":""},{"title":"What is the Treasury general account? ","permalink":"https://fred.stlouisfed.org/blog/2026/09/what-is-the-treasury-general-account","date":"2026-09-28 08:00:00","content":"&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1Y2hr&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;
&lt;h2&gt;The takeaway&lt;/h2&gt;
&lt;p&gt;When you hear commentary on the federal government&#39;s financial situation, the information is often based on the money flowing into and out of the Treasury general account.&lt;/p&gt;
&lt;h2&gt;The US government&#39;s checking account&lt;/h2&gt;
&lt;p&gt;As with any household or business, even the federal government needs an account to handle its bills and receive income from various sources. This account, provided by the Federal Reserve in its role as fiscal agent of the federal government, is called the Treasury general account. Our FRED graph above is updated with the account&#39;s balance every Wednesday.&lt;/p&gt;
&lt;h2&gt;Reserves held at the Fed&lt;/h2&gt;
&lt;p&gt;The holdings of the Treasury general account are considered to be reserves at the Fed, equivalent to the reserves that banks hold there. The level of these balances in the general account was initially kept to a minimum to avoid interfering with Fed policy and the handling of reserve requirements. That changed in 2008 with the financial crisis, when it became routine for banks to hold excess reserves at the Fed and earn interest on them.&lt;/p&gt;
&lt;p&gt;Since then, the Treasury general account has been holding considerable balances, at times over a trillion dollars.&lt;/p&gt;
&lt;p&gt;There are also notable drawdowns on the balance. When new Treasury bonds are issued through the Fed at an auction, the proceeds land in the account. The balance gets reduced when Treasury bonds are bought back on the market, when the government issues stimulus checks, and when tax rebates turn out to be high.
When the balance gets close to zero, it&#39;s often because a debt ceiling is approaching. At times like these, you often hear someone commenting that the federal government will run out of cash at some date. Such forecasts are made by looking at this account, its inflows, and its outflows.&lt;/p&gt;
&lt;p&gt;&lt;strong&gt;How this graph was created&lt;/strong&gt;: Search &lt;a href=&quot;https://fred.stlouisfed.org/&quot;&gt;FRED&lt;/a&gt; for and select &quot;Treasury general account.&quot;&lt;/p&gt;
&lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/research/economists/zimmermann&quot;&gt;Christian Zimmermann&lt;/a&gt;.&lt;/p&gt;","additional_content":""},{"title":"Estimating the risk of recession in the US","permalink":"https://fred.stlouisfed.org/blog/2026/09/estimating-the-risk-of-recession-in-the-us","date":"2026-09-24 08:00:00","content":"&lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1Y29S&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;h2&gt;The takeaway&lt;/h2&gt; &lt;p&gt;A new dataset in FRED provides the monthly probability the US economy is in recession. The latest data, for August 2026, show that probability was 0.08%.&lt;/p&gt; &lt;h2&gt;The data&lt;/h2&gt; &lt;p&gt;FRED has added probability estimates of the US economy being in recession. The dataset comes from &lt;a href=&quot;https://recessionrisk.com/&quot;&gt;RecessionRisk.com&lt;/a&gt; and was developed by economists Francesco Furno and Domenico Giannone. Our FRED graph above shows these monthly median probabilities since January 1980. Probability values range from 0% to 100%, where values closer to 100 indicate higher probability of recession.&lt;/p&gt; &lt;p&gt;Because the calculations incorporate timely indicators, these estimates are available on the first business day after the reference month closes. For example, the recession risk value for August 2026 (0.08%) became available on the first business day of September 2026.&lt;/p&gt; &lt;p&gt;The shaded areas in the graph represent the start and end dates of recessions reported by the National Bureau of Economic Research (NBER) Business Cycle Dating Committee. This data visualization feature can be turned on and off in every FRED graph by following the steps described &lt;a href=&quot;https://fredhelp.stlouisfed.org/fred/graphs/customize-a-fred-graph/change-graph-settings/&quot;&gt;here&lt;/a&gt;.&lt;/p&gt; &lt;h2&gt;The interpretation&lt;/h2&gt; &lt;p&gt;The overlap between the RecessionRisk.com data and the NBER data is generally close. The timing of spikes in the estimated probability of recession broadly coincide with the dates announced by the NBER for turning points in the US business cycle from expansion to contraction. (That is, &lt;em&gt;the occurrence of recessions&lt;/em&gt;.) However, several probability spikes, such as the ones around October 1998 and March 2023, did not develop into actual recessions.&lt;/p&gt; &lt;h2&gt;The methodology&lt;/h2&gt; &lt;p&gt;The probability estimates are calculated using a statistical model that combines two indicators. The first measures broad economic conditions, and the second measures financial market stress:&lt;/p&gt; &lt;ul&gt; &lt;li&gt;Institute for Supply Management’s Purchasing Managers&amp;#8217; Index (PMI) for manufacturing, which is a survey of business conditions&lt;/li&gt; &lt;li&gt;The Composite Indicator of Systemic Stress (CISS) reported by the European Central Bank, which tracks stress across bond, equity, money, foreign exchange, and financial intermediary markets&lt;/li&gt; &lt;/ul&gt; &lt;p&gt;Details about the methodologies are available &lt;a href=&quot;https://ideas.repec.org/h/elg/eechap/22222_7.html&quot;&gt;here&lt;/a&gt;.&lt;/p&gt; &lt;p&gt;&lt;b&gt;How this graph was created&lt;/b&gt;: Search &lt;a href=&quot;https://fred.stlouisfed.org/&quot;&gt;FRED&lt;/a&gt; for and select “Recession Probability for the United States, Median Estimate.”&lt;/p&gt; &lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/research/information-services#diego&quot;&gt;Diego Mendez-Carbajo&lt;/a&gt;.&lt;/p&gt;","additional_content":""},{"title":"FOMC Summary of Economic Projections, September 2026","permalink":"https://fred.stlouisfed.org/blog/2026/09/fomc-summary-of-economic-projections-september-2026","date":"2026-09-21 08:00:00","content":"&lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://alfred.stlouisfed.org/graph/graph-landing.php?g=1YFHc&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;p&gt;In a &lt;a href=&quot;https://fredblog.stlouisfed.org/2026/06/fomc-summary-of-economic-projections-june-2026/&quot;&gt;previous FRED Blog post&lt;/a&gt;, we discussed the Summary of Economic Projections (SEP) &lt;a href=&quot;https://www.federalreserve.gov/monetarypolicy/files/fomcprojtabl20260617.pdf&quot;&gt;released by the FOMC this past June&lt;/a&gt;. In this blog post, we again use ALFRED to compare the latest set of projections &lt;a href=&quot;https://www.federalreserve.gov/monetarypolicy/files/fomcprojtabl20260916.pdf&quot;&gt;released in September 2026&lt;/a&gt; with several recent projections for the unemployment rate, core personal consumption expenditures (PCE) inflation, real GDP growth, and the federal funds rate.&lt;/p&gt; &lt;p&gt;It is important to note that these projections represent neither a committee plan nor a binding decision on future policy.&lt;/p&gt; &lt;p&gt;Our first ALFRED graph, above, shows the median projection for the unemployment rate for the fourth quarters of 2026, 2027, 2028, and 2029. This latest set of projections is the first to include 2029, as every September the FOMC adds another year to the SEP. Most recently, as shown by the gold bar, the median FOMC participant projects that the unemployment rate will average 4.1% in Q4 2026 and remain at that level through Q4 2029. This is slightly below the median projections from June.&lt;/p&gt; &lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://alfred.stlouisfed.org/graph/graph-landing.php?g=1YFHX&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;p&gt;Our second graph shows the median projection for core PCE inflation over the same period. The median FOMC participant projects 3.4% core PCE inflation over 2026, with a return to the long-run inflation target of 2% by 2029.&lt;/p&gt; &lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://alfred.stlouisfed.org/graph/graph-landing.php?g=1YFIg&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;p&gt;Our third graph shows the median projections for real GDP growth. For 2026, real GDP growth was revised up from 2.2% in June to 2.3% in September, still shy of the 2.4% projected in March. The projection for real GDP growth in 2027 is slightly higher than it was in both March and June, revised up from 2.3% to 2.4%. Looking further ahead, the median projection for 2028 matches June’s result of 2.2% while the initial projection for 2029 stands at 2.1%, suggesting the Committee anticipates growth converging toward its longer-run trend of 2.0%&lt;/p&gt; &lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://alfred.stlouisfed.org/graph/graph-landing.php?g=1YFJa&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;p&gt;Our final graph shows the median participant’s projections of the federal funds rate. You may notice that the blue bar depicts the September 2025 vintage. This is because the SEP projections for the federal funds rate in December 2025 were exactly the same as the September 2025 vintage.&lt;/p&gt; &lt;p&gt;As of the September 2026 SEP, the median projection for the federal funds rate at the end of this year is 4.1%, where it remains in 2027 before falling to 3.9% by year-end 2028. These projections are higher than those in June by 0.3 percentage points this year and 0.5 percentage points in both 2027 and 2028. The fourth quarter projection for 2029 stands at 3.6%.&lt;/p&gt; &lt;p&gt;It&amp;#8217;s worth noting that focusing on the median federal funds rate projection can obscure the dispersion of the individual participant projections. For example, projections for the 2029 year-end policy rate range from 2.9% to 3.9%.&lt;/p&gt; &lt;p&gt;&lt;b&gt;How these graphs were created&lt;/b&gt;: Search &lt;a href=&quot;https://alfred.stlouisfed.org/&quot;&gt;ALFRED&lt;/a&gt; for “FOMC unemployment” and take the median projection. Click on “Edit Graph,” choose a bar graph, and add three bars with the same series again. Finally, select the proper vintage for each bar. Change the dates to 2026-01-01 to 2029-01-01. For the other graphs, proceed similarly with “FOMC PCE core,” “FOMC GDP,” and “FOMC federal funds rate.”&lt;/p&gt; &lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/research/research-associates&quot;&gt;Rehann Silvanus&lt;/a&gt; and &lt;a href=&quot;https://www.stlouisfed.org/research/economists&quot;&gt;Kathleen Navin&lt;/a&gt;.&lt;/p&gt;","additional_content":""},{"title":"Using options prices to measure financial risk","permalink":"https://fred.stlouisfed.org/blog/2026/09/using-options-prices-to-measure-financial-risk","date":"2026-09-17 08:00:00","content":"&lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1XXSa&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;h2&gt;The takeaway&lt;/h2&gt; &lt;p&gt;The Kansas City Fed uses options prices to measure how financial markets perceive the balance of risks for future short-term interest rates: a.k.a., the KC Policy Rate Skew.&lt;/p&gt; &lt;h2&gt;The data&lt;/h2&gt; &lt;p&gt;Options are publicly traded financial instruments that reflect expectations about future economic conditions. The Kansas City Fed uses options prices to create their daily index of how financial markets perceive the balance of risks, or &amp;#8220;skew,&amp;#8221; to short-term U.S. interest rates one year in the future. Our FRED graph above shows the value of this &amp;#8220;KC PRS&amp;#8221; index over the past five years, although daily data in FRED are available as far back as April 3, 1989.&lt;/p&gt; &lt;p&gt;FYI, the KC PRS is constructed with the same methodology as the Chicago Board Options Exchange Skew Index (&lt;a href=&quot;https://ideas.repec.org/a/fip/fedker/98988.html&quot;&gt;Cboe Skew&lt;/a&gt;) on the Chicago Mercantile Exchange’s options data.&lt;/p&gt; &lt;h2&gt;The interpretation&lt;/h2&gt; &lt;p&gt;Although the ups and downs of the KC PRS don&amp;#8217;t match the expansions and contractions of the business cycle, &lt;a href=&quot;https://ideas.repec.org/a/fip/fedkeb/99292.html&quot;&gt;research from the KC Fed&lt;/a&gt; indicates that this index tends to lead (i.e., occur ahead of) the cyclical patterns in interest rates&lt;/p&gt; &lt;p&gt;A positive value of the KC PRS index indicates financial markets believe interest rates are more likely to end up higher than projected, whereas a negative value suggests rates could end up lower than projected. Between mid-September 2022 and late March 2026, the index generally showed values below zero. Between early 2026 and the time of this writing, it has averaged values above zero.&lt;/p&gt; &lt;p&gt;&lt;b&gt;How this graph was created&lt;/b&gt;: Go to &lt;a href=&quot;https://fred.stlouisfed.org/&quot;&gt;FRED&lt;/a&gt; and search for &amp;#8220;Kansas City Fed&amp;#8217;s Policy Rate Skew.&amp;#8221; To plot the data over the past five years, click on the “5Y” link above the graph’s canvas.&lt;/p&gt; &lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/research/information-services#diego&quot;&gt;Diego Mendez-Carbajo&lt;/a&gt;.&lt;/p&gt;","additional_content":""},{"title":"Measuring money with M2","permalink":"https://fred.stlouisfed.org/blog/2026/09/measuring-money-with-m2","date":"2026-09-14 08:00:00","content":"&lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1XYiA&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;h2&gt;The takeaway&lt;/h2&gt; &lt;p&gt;The Fed&amp;#8217;s monetary aggregates measure the amount of money in the economy. One such measure is M2, which includes liquid assets such as checking accounts but excludes non-liquid assets such as individual retirement accounts.&lt;/p&gt; &lt;h2&gt;What is M2?&lt;/h2&gt; &lt;p&gt;M2 measures how much money is readily available in the economy. That is, funds easily converted to cash. As of June 2026, M2 amounted to $23 trillion.&lt;/p&gt; &lt;p&gt;Our FRED graph above shows the components of M2:&lt;/p&gt; &lt;ul&gt; &lt;li&gt;M1 in blue, which itself includes cash and checking and savings accounts&lt;/li&gt; &lt;li&gt;Small-denomination time deposits in green&lt;/li&gt; &lt;li&gt;Retail money market funds in brown&lt;/li&gt; &lt;li&gt;The total value of individual retirement account (IRA) and Keogh retirement account balances, in purple, is subtracted from this measure. These funds carry large penalties for preretirement withdrawals and, therefore, aren&amp;#8217;t considered liquid.&lt;/li&gt; &lt;/ul&gt; &lt;h2&gt;Recent changes&lt;/h2&gt; &lt;p&gt;Surveys by the Board of Governors of the Federal Reserve System in recent years show that a growing share of IRA and Keogh balances held at depository institutions now sit in savings and checking-type accounts, rather than in small-denomination time deposits or in retail money market funds.&lt;/p&gt; &lt;p&gt;Starting July 28, 2026, these IRA and Keogh balances have been subtracted from the &lt;em&gt;total value&lt;/em&gt; of M2, rather than from the &lt;em&gt;individual values&lt;/em&gt; of the small-denomination time deposits and retail money market funds. This had almost no impact on the total value of M2, but it did result in the recalculation of those two components.&lt;/p&gt; &lt;h2&gt;Graph these changes&lt;/h2&gt; &lt;p&gt;ALFRED stores vintages of FRED data and allows you to see the historical values of both &lt;a href=&quot;https://alfred.stlouisfed.org/graph/?g=1XU92&quot;&gt;small-denomination time deposits&lt;/a&gt; and &lt;a href=&quot;https://alfred.stlouisfed.org/graph/?g=1XU96&quot;&gt;retail money market funds&lt;/a&gt; before and after this reporting changes. Both data series now show higher values.&lt;/p&gt; &lt;h2&gt;More details&lt;/h2&gt; &lt;p&gt;M2 data come from the Fed&amp;#8217;s &lt;a href=&quot;https://fred.stlouisfed.org/release?rid=21&quot;&gt;H.6&lt;/a&gt; statistical release, Money Stock Measures, published weekly by the Federal Reserve Board. Keep up with their announcements &lt;a href=&quot;https://www.federalreserve.gov/feeds/h6.html&quot;&gt;here&lt;/a&gt;.&lt;/p&gt; &lt;p&gt;What about that orange area in the graph? It shows saving deposits. As of April 2020, this component was reclassified from a category of M2 into M1, so our graph doesn&amp;#8217;t show the value past that date. Learn more about this regulatory change &lt;a href=&quot;https://fredblog.stlouisfed.org/2021/05/savings-are-now-more-liquid-and-part-of-m1-money/&quot;&gt;here&lt;/a&gt;.&lt;/p&gt; &lt;p&gt;&lt;b&gt;How this graph was created&lt;/b&gt;: Search &lt;a href=&quot;https://fred.stlouisfed.org/&quot;&gt;FRED&lt;/a&gt; for “M1.” Click the “Edit Graph” button and select the “Add Line” tab to search for “Small-Denomination Time Deposits: Total.” Don’t forget to click “Add data series.” Repeat this last step to search for and add the other two series: “Retail Money Market Funds” and “IRA and Keogh Accounts: Total.” Next, use the “Select Area” dropdown menu to customize “Line 4 – IRA and Keogh Accounts” by typing the formula &lt;i&gt;-a&lt;/i&gt; and clicking on “Apply Formula.” Last, select the “Format” panel to pick “Graph type: Area” and “Stacking: Normal.”&lt;/p&gt; &lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/research/information-services#maria&quot;&gt;Maria Arias&lt;/a&gt; and &lt;a href=&quot;https://www.stlouisfed.org/research/information-services#diego&quot;&gt;Diego Mendez-Carbajo&lt;/a&gt;.&lt;/p&gt;   &lt;p /&gt;","additional_content":""},{"title":"A new calculation for subprime credit risk","permalink":"https://fred.stlouisfed.org/blog/2026/09/a-new-calculation-for-subprime-credit-risk","date":"2026-09-10 08:00:00","content":"&lt;div class=&quot;embed-map&quot; style=&quot;width: 670px; height: 720px; overflow: visible;&quot;&gt;&lt;iframe style=&quot;overflow: visible !important; width: 670px; height: 720px !important;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?m=1XUkA&amp;amp;width=670&amp;amp;height=640&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/div&gt; &lt;h2&gt;The takeaway&lt;/h2&gt; &lt;p&gt;The New York Fed&amp;#8217;s consumer credit dataset is now calculated with a different methodology—one that includes 33 million more borrowers than before.&lt;/p&gt; &lt;h2&gt;The Consumer Credit Panel&lt;/h2&gt; &lt;p&gt;With a data update on August 10, 2026, the New York Fed has changed the way it measures subprime credit risk in their Consumer Credit Panel, moving from the old/discontinued methodology of Equifax Risk Score 3.0 to the new methodology of Vantage Score 4.0.&lt;/p&gt; &lt;p&gt;Our FRED map above shows, for each U.S. county, the percent of the resident population with a credit score below 660 in Q4 of 2025—again, with data from the revised version of their Consumer Credit Panel.&lt;/p&gt; &lt;p&gt;The New York Fed advises users to &amp;#8220;&lt;a href=&quot;https://www.newyorkfed.org/microeconomics/faq&quot;&gt;exercise caution&lt;/a&gt; when comparing credit score distribution changes from 2025:Q4 to 2026:Q1, as differences may reflect the change in scoring model rather than changes in borrower credit quality.”&lt;/p&gt; &lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://alfred.stlouisfed.org/graph/graph-landing.php?g=1XSjT&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;h2&gt;Comparing the old and new measures&lt;/h2&gt; &lt;p&gt;We can use our archival ALFRED database to compare the data vintages of the new Vantage Score 4.0 methodology with the vintages of the old/discontinued Equifax Risk Score 3.0 methodology. The graph shows the data for New York County (i.e., Manhattan). Clearly, these percentages are substantially higher now than they had been. For example, the current subprime share of 30.27% (green line, for Q4 2025) had been 17.72% (blue line, for Q4 2025) before the methodology was revised.&lt;/p&gt; &lt;h2&gt;What changed, exactly?&lt;/h2&gt; &lt;p&gt;Vantage Score 4.0 is a credit-scoring model that uses a broader set of personal finance information details than the Equifax Risk Score 3.0 it replaced. By casting a broader scoring net, 33 million additional borrowers that previously were unscored are now factored into the calculations of subprime lenders as a fraction of overall populations. And, in a fraction, when the numerator rises more than the denominator, the resulting ratio rises.&lt;/p&gt; &lt;p&gt;&lt;a href=&quot;https://www.newyorkfed.org/microeconomics/medialibrary/media/research/microeconomics/hhdc/HDC_TechnicalReport_CreditScoreChange&quot;&gt;Read more from the New York Fed&lt;/a&gt; about this switch in methodology and its potential implications for analysts and researchers.&lt;/p&gt; &lt;p&gt;&lt;b&gt;How the FRED map and ALFRED graphs were created&lt;/b&gt;: For the map, search &lt;a href=&quot;https://fred.stlouisfed.org/&quot;&gt;FRED&lt;/a&gt; for and select “Equifax Subprime Credit Population for New York County, NY.” Click on “View Map” and select the date “2025-10-01.” For the graph: Search &lt;a href=&quot;https://alfred.stlouisfed.org/&quot;&gt;ALFRED&lt;/a&gt; for and select “Equifax Subprime Credit Population for New York County, NY.” Click on “Edit Graph” and select the “Format” tab. Use the dropdown menu to select “Graph Type: Line.” Last, adjust the date range by clicking on the “Max” option above the graph canvas.&lt;/p&gt; &lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/research/information-services#diego&quot;&gt;Diego Mendez-Carbajo&lt;/a&gt;.&lt;/p&gt;","additional_content":""},{"title":"Measures of consumer sentiment","permalink":"https://fred.stlouisfed.org/blog/2026/09/measures-of-consumer-sentiment","date":"2026-09-03 08:00:00","content":"&lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1XVua&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;h2&gt;The takeaway&lt;/h2&gt; &lt;p&gt;Measures of household financial well-being don’t always align with consumer sentiment. You can feel relatively secure about your finances while still being pessimistic about the overall economy.&lt;/p&gt; &lt;p&gt;&amp;nbsp;&lt;/p&gt; &lt;h2&gt;Are you doing OK?&lt;/h2&gt; &lt;p&gt;In &lt;a href=&quot;https://fredblog.stlouisfed.org/?s=financial+well+being&quot;&gt;an earlier post&lt;/a&gt;, we described a measure of household financial well-being from the Federal Reserve Board’s Survey of Household Economics and Decisionmaking (SHED). In this post, we add a way to measure households&amp;#8217; view of the economy: the University of Michigan’s Index of Consumer Sentiment.&lt;/p&gt; &lt;p&gt;Our FRED graph above tracks, side by side, the share of adults who say they’re “doing okay financially” from the SHED and the index values of consumer sentiment from the University of Michigan.&lt;/p&gt; &lt;p&gt;Before the COVID-19 pandemic, these two measures moved in the same direction. The share of adults doing at least okay financially increased, while consumer sentiment was also relatively high. The story looks different after the pandemic. Consumer sentiment fell sharply and remains low: Its value averaged 95.9 in 2019 and was 71.7 in January 2025. The share of adults saying they&amp;#8217;re doing at least okay, though, has remained relatively high: It was 75% in 2019 and it was 73% in 2025.&lt;/p&gt; &lt;p&gt;There seems to be a disconnect. Most respondents continue to report financial stability while overall consumer sentiment is much more pessimistic than it was before the pandemic.&lt;/p&gt; &lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1XVuc&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;h2&gt;Are you worse off today?&lt;/h2&gt; &lt;p&gt;The SHED also asks a more specific question: Are you worse off financially than you were 12 months ago?&lt;/p&gt; &lt;p&gt;Our second FRED graph, above, compares this measure with the same Michigan Consumer Sentiment Index. (We plot 100 minus the percentage so that an increase in one series is consistent with a increase in the other.)&lt;/p&gt; &lt;p&gt;Here, the two measures tell a more similar story. Before the pandemic, the share of adults reporting they were &lt;i&gt;not&lt;/i&gt; worse off than they were a year earlier was increasing. After the pandemic, that share dropped sharply and has remained low. Measured this way, households’ assessments of their own finances are more consistent with the decline in overall consumer sentiment.&lt;/p&gt; &lt;p&gt;The difference between the two SHED measures may partly reflect what each question is asking. Saying you&amp;#8217;re doing okay financially describes your current financial position. Saying you&amp;#8217;re worse off than a year ago describes how that position has changed. It&amp;#8217;s not hard to imagine a household reporting both these things at the same time.&lt;/p&gt; &lt;p&gt;It’s also possible that financial experiences have become more uneven across households, with some households doing relatively well while others have seen their financial situations deteriorate, consistent with the divergence of the two SHED measures.&lt;/p&gt; &lt;p&gt;And there&amp;#8217;s another possibility. People may feel relatively secure about their &lt;em&gt;own&lt;/em&gt; finances while still being pessimistic about the economy &lt;em&gt;overall&lt;/em&gt;. The SHED explicitly asks about respondents’ own financial situations. The Michigan index is broader, incorporating views about personal finances, business conditions, and buying conditions. That leaves room for a disconnect between how people assess their own circumstances and how they assess economic conditions more generally.&lt;/p&gt; &lt;p&gt;The graphs don&amp;#8217;t tell us exactly what&amp;#8217;s driving the difference, but they show people’s assessments of their own finances can look quite different from their assessments of the broader economy.&lt;/p&gt; &lt;p&gt;&lt;b&gt;How the graphs were created&lt;/b&gt;:&lt;br /&gt; For the first graph, search FRED for and select “Survey of Household Economics and Decisionmaking: At Least Doing Okay Financially: All Adults” (series ID ATLEASTDOINGOKAYFINANCIAL). Click &amp;#8220;Edit Graph,&amp;#8221; click &amp;#8220;Add Line,&amp;#8221;  and search for and select “University of Michigan: Consumer Sentiment” (series ID UMCSENT). Click &amp;#8220;Add Data Series.&amp;#8221; Next, select the University of Michigan series under &amp;#8220;Edit Lines&amp;#8221; and open the &amp;#8220;Format&amp;#8221; tab. Set its y-axis position to &amp;#8220;Right.&amp;#8221; Set this graph to begin on January 1, 2013. and end on January 1, 2025, corresponding to the first and last years, respectively, available for this SHED measure.&lt;br /&gt; For the second graph, repeat the same steps, replacing the first SHED series with “Survey of Household Economics and Decisionmaking: Worse Off Financially Than 12 Months Ago: All Adults” (series ID WORSEOFFFINANCIALLYALLADU). For this series, enter &lt;i&gt;100-a&lt;/i&gt; in the formula field. Again, add UMCSENT as the second line and place it on the right y-axis. Set this graph to begin on January 1, 2014, and end on January 1, 2025, corresponding to the first and last years, respectively, available for this SHED measure.&lt;/p&gt; &lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/research/economists/gregory&quot;&gt;Victoria Gregory&lt;/a&gt;.&lt;/p&gt;","additional_content":""},{"title":"Is this a good time to rent?","permalink":"https://fred.stlouisfed.org/blog/2026/08/is-this-a-good-time-to-rent","date":"2026-08-31 08:00:00","content":"&lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1XSt7&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt;
&lt;h2&gt;The takeaway&lt;/h2&gt;
&lt;p&gt;The most recent measure of the cost of owning a home (vs. renting a home) remains near historical peaks, suggesting renting today is a relatively better financial choice for housing.&lt;/p&gt;
&lt;h2&gt;To own or not to own?&lt;/h2&gt;
&lt;p&gt;Which is the better financial choice&amp;mdash;owning or renting your home? The FRED Blog &lt;a href=&quot;https://fredblog.stlouisfed.org/2022/08/renting-or-owning-which-type-of-housing-cost-has-increased-more/&quot;&gt;has discussed&lt;/a&gt; how the cost of owning a home and the cost of renting a home tend to move together. An indexed ratio of house prices to rents helps show their relative values more clearly and, by extension, can help examine the value of one choice over the other.&lt;/p&gt;
&lt;p&gt;A high ratio means house prices are growing faster than rents, making homeownership a relatively more expensive proposition. A lower ratio means buying a home is a comparatively better deal.&lt;/p&gt;
&lt;h2&gt;The data&lt;/h2&gt;
&lt;p&gt;&lt;a href=&quot;https://www.dallasfed.org/research/economics/2025/0225&quot;&gt;Researchers at the Dallas Fed&lt;/a&gt; used price index data for homeownership and renting to create an index that shows the rapid rise of homeownership costs in 2020 and the high values since then.&lt;/p&gt;
&lt;p&gt;Our FRED graph above allows us to approximate their ratio and track the relative cost of owning a home from first quarter 1975 to first quarter 2026. Here we use two different price indexes to create our ratio of house prices to rents: the &lt;a href=&quot;https://fred.stlouisfed.org/series/USSTHPI&quot;&gt;all-transactions house price index&lt;/a&gt; from the U.S. Federal Housing Finance Agency and &lt;a href=&quot;https://fred.stlouisfed.org/series/CUUR0000SEHA&quot;&gt;the CPI for rents&lt;/a&gt; from the Bureau of Labor Statistics. Both indexes were &amp;ldquo;re-based&amp;rdquo; to a value of 100 in January 2015. Our index shows a rapid rise and continued high values of homeownership cost, similar to what the Dallas Fed research showed.&lt;/p&gt;
&lt;h2&gt;Deeper analysis&lt;/h2&gt;
&lt;p&gt;The report from the Dallas Fed uses both U.S. and international data to identify patterns and the likely future evolution of an elevated house price-to-rent ratio. It concludes that &amp;ldquo;Rents rise along with inflation, while nominal house-price growth trails inflation. On an inflation-adjusted basis, rents change very little, but house prices fall sharply.&amp;rdquo;&lt;/p&gt;
&lt;p&gt;In this homeownership costs ratio, the numerator is house prices and the denominator is rent prices. The ratio will become smaller if the numerator falls or the denominator rises. Because inflation increases rent prices relatively more than house prices, higher inflation would drive the ratio down, closer to its historical average.&lt;/p&gt;
&lt;p&gt;&lt;strong&gt;How this graph was created&lt;/strong&gt;: Search &lt;a href=&quot;https://fred.stlouisfed.org/&quot;&gt;FRED&lt;/a&gt; for and select the series &amp;ldquo;All-Transactions House Price Index for the United States.&amp;rdquo; Click &amp;ldquo;Edit Graph,&amp;rdquo; use &amp;ldquo;Customize data&amp;rdquo; to search for &amp;ldquo;Consumer Price Index for All Urban Consumers: Rent of primary residence,&amp;rdquo; and click &amp;ldquo;Add.&amp;rdquo; Input the formula &lt;em&gt;a/b&lt;/em&gt; and click &amp;ldquo;Apply.&amp;rdquo;&lt;/p&gt;
&lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/careers/yourcareer/opportunities/internship-program&quot;&gt;Houston Myer&lt;/a&gt; and &lt;a href=&quot;https://www.stlouisfed.org/research/information-services#diego&quot;&gt;Diego Mendez-Carbajo&lt;/a&gt;.&lt;/p&gt;
&lt;p&gt;&amp;nbsp;&lt;/p&gt;","additional_content":""},{"title":"Does generative AI save time at work?","permalink":"https://fred.stlouisfed.org/blog/2026/08/does-generative-ai-save-time-at-work","date":"2026-08-27 08:00:00","content":"&lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1XMjh&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;h2&gt;The takeaway&lt;/h2&gt; &lt;p&gt;More workers are using generative AI tools, using them more often, and saving more time because of them, according to new survey data in FRED.&lt;/p&gt; &lt;h2&gt;The survey&lt;/h2&gt; &lt;p&gt;Economists Alexander Bick, Adam Blandin, and David Deming built the Generative Artificial Intelligence Adoption Tracker using data from the &lt;a href=&quot;https://fred.stlouisfed.org/release?rid=6&quot;&gt;Real-Time Population Survey (RPS)&lt;/a&gt;. The RPS is a nationally representative online survey of working-age adults aged 18 to 64. Each quarter, employed respondents report how fast and how intensely they&amp;#8217;re adopting AI technology both at work and outside of work.&lt;/p&gt; &lt;h2&gt;The data&lt;/h2&gt; &lt;p&gt;Our FRED graph above shows three data series from the generative AI adoption tracker: &amp;#8220;Use Last Week for Work&amp;#8221; (solid blue line), &amp;#8220;Work Hours Assisted&amp;#8221; (dashed green line), and &amp;#8220;Time Savings&amp;#8221; (dashed orange line)—all measured as a percent of employed adults (left axis) or percent of work hours (right axis).&lt;/p&gt; &lt;p&gt;All three lines trend steadily upward. The share of employed adults who used generative AI for work in the past week grew from 28.2% in Q3 2024 to 39.2% by Q2 2026, indicating adoption is broadening. The share of work hours assisted by generative AI grew from 4.1% to 6.3% over roughly the same stretch. Perhaps most importantly, the share of work hours saved thanks to AI assistance grew from 1.6% to 2.2%.&lt;/p&gt; &lt;h2&gt;The summary&lt;/h2&gt; &lt;p&gt;The information is based on how respondents self-report their &amp;#8220;time saved,&amp;#8221; so the measurements are inherently approximate. But these three data series together do tell a coherent story of AI adoption: More workers are trying generative AI, and the ones already using it are leaning on it more heavily. Rising time savings suggest AI is not just a novelty; it&amp;#8217;s starting to free up real work hours. If this trend holds, generative AI could show up in broader productivity statistics in the years ahead.&lt;/p&gt; &lt;p&gt;&lt;b&gt;How this graph was created&lt;/b&gt;: Search &lt;a href=&quot;https://fred.stlouisfed.org/&quot;&gt;FRED&lt;/a&gt; for “Generative Artificial Intelligence, Use Last Week for Work: Employed Adults.” Click “Edit Graph” and select the “Add Line” tab. Search for “Generative Artificial Intelligence, Work Hours Assisted: Employed Adults” and click “Add Data Series.” Repeat the last step to search for and add “Generative Artificial Intelligence, Time Savings: Employed Adults.” Select the “Format” tab to customize line 2 and line 3 by selecting “Y-Axis position: Right.”&lt;/p&gt; &lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/research/information-services#diego&quot;&gt;Diego Mendez-Carbajo&lt;/a&gt;.&lt;/p&gt;   &lt;p /&gt;","additional_content":""},{"title":"State and metro employment: Second quarter 2026","permalink":"https://fred.stlouisfed.org/blog/2026/08/state-and-metro-employment-second-quarter-2026","date":"2026-08-24 08:00:00","content":"&lt;div class=&quot;embed-map&quot; style=&quot;width: 670px; height: 720px; overflow: visible;&quot;&gt;&lt;iframe style=&quot;overflow: visible !important; width: 670px; height: 720px !important;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?m=1XU4i&amp;amp;width=670&amp;amp;height=640&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/div&gt; &lt;p&gt;National employment growth in the second quarter of 2026 accelerated slightly to 0.3% compared with one year ago. However, this aggregate figure conceals wide variation in job growth across U.S. states: 38 states experienced job growth, while 12 states plus the District of Columbia experienced job losses relative to one year ago. The median state experienced job growth of roughly 0.4%. Moreover, 25 states experienced growth above the median, highlighting growing resilience.&lt;/p&gt; &lt;p&gt;Our FRED map above shows the percent change from a year ago in employment in each state during the second quarter. Minnesota and Nevada had the strongest growth, with net job gains of 1.4% and 2%, respectively. The District of Columbia and Montana had the largest net job losses, at -4.8% and -1%, respectively.&lt;/p&gt; &lt;div class=&quot;embed-map&quot; style=&quot;width: 670px; height: 720px; overflow: visible;&quot;&gt;&lt;iframe style=&quot;overflow: visible !important; width: 670px; height: 720px !important;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?m=1XTwJ&amp;amp;width=670&amp;amp;height=640&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/div&gt; &lt;p&gt;At the metro level, job growth on average displayed weaker trends than the state-level data, with the median MSA experiencing a slight job gain of 0.2% in the second quarter of 2026 relative to one year ago. The Waterloo-Cedar Falls, Iowa, MSA had the largest net job loss at -3.2%. In contrast, the Sandusky, Ohio, MSA had the strongest job growth, at 5%. These numbers tend to vary greatly from quarter to quarter, with even greater sampling errors than the errors at the state and national levels. So, be careful not to read too much into these data.&lt;/p&gt; &lt;p&gt;&lt;b&gt;How these maps were created&lt;/b&gt;: Search &lt;a href=&quot;https://fred.stlouisfed.org/&quot;&gt;FRED&lt;/a&gt; for “total nonfarm employees in Missouri” (or any other state). Click “View Map” and then “Edit Map.” Change the units to “Percent Change from Year Ago” and the frequency to quarterly with aggregation method “End of Period.” Under “Format,” select “User Defined Method” for how to group the data: Switch the number of color groups to 3 and change the colors to red for states that shed jobs (or a value less than or equal to 0), light yellow for states with modest job growth (or less than 0.4), and dark green for states with strong growth (or a value large enough to incorporate the rest of the states). For the second map, repeat the process with an MSA—St. Louis, for example.&lt;/p&gt; &lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/research/economists/gutkowski&quot;&gt;Violeta Gutkowski&lt;/a&gt; and &lt;a href=&quot;https://www.stlouisfed.org/research/research-associates&quot;&gt;Rehann Silvanus&lt;/a&gt;.&lt;/p&gt;   &lt;p&gt;&lt;/p&gt; ","additional_content":""},{"title":"Is AI reducing employment for software coders?","permalink":"https://fred.stlouisfed.org/blog/2026/08/is-ai-reducing-employment-for-software-coders","date":"2026-08-20 08:00:00","content":"&lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1XMR7&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;h2&gt;The takeaway&lt;/h2&gt; &lt;p&gt;Employment of software coders has decelerated sharply since 2022. Recent research suggests this job-specific shock isn’t caused by a slowing industry but likely from the emergence of AI tools.&lt;/p&gt; &lt;h2&gt;What employment data show&lt;/h2&gt; &lt;p&gt;Our FRED graph above shows annual employment data for 1991-2025 reported by the US Bureau of Labor Statistics: The solid blue line shows the year-over-year percent change in &lt;em&gt;total&lt;/em&gt; employment. The dashed green line shows the same measure but specifically for computer systems design and related services.&lt;/p&gt; &lt;p&gt;Annual employment growth in the computer systems design industry has outpaced overall employment growth, except for two distinct periods:&lt;/p&gt; &lt;ul&gt; &lt;li&gt;In 2002-2003, the industry reeled back from the dot-com buildup of the late 1990s and was exposed to the 2001 recession.&lt;/li&gt; &lt;li&gt;After 2022, a different type of employment shock took place.&lt;/li&gt; &lt;/ul&gt; &lt;h2&gt;What recent research shows&lt;/h2&gt; &lt;p&gt;Analysis by &lt;a href=&quot;https://ideas.repec.org/p/fip/fedgfe/102997.html&quot;&gt;Leland D. Crane and Paul E. Soto&lt;/a&gt; at the Board of Governors of the Federal Reserve System finds that aggregate employment of software coders decelerated sharply after the broad public launch of generative AI tools in November 2022.&lt;/p&gt; &lt;p&gt;The research points out that more than 30% of national coder employment is concentrated in the computer systems design and related services industry, 40% of which consists of coders.&lt;/p&gt; &lt;p&gt;These researchers were able to establish a likely causal effect between the public launch of ChatGPT and employment by modeling a counterfactual employment scenario without any external shock and then comparing that with the actual data. This allowed them to tell the difference between an occupational shock particular to coders and a shock to the broader industry that would also impact related computer system designs jobs.&lt;/p&gt; &lt;p&gt;To learn more about this topic, check this &lt;a href=&quot;https://fredblog.stlouisfed.org/2023/03/was-there-a-tech-hiring-bubble/&quot;&gt;earlier FRED Blog post&lt;/a&gt; on the sharp decrease in job postings in the broader tech industry.&lt;/p&gt; &lt;p&gt;&lt;b&gt;How this graph was created&lt;/b&gt;: Search &lt;a href=&quot;https://fred.stlouisfed.org/&quot;&gt;FRED&lt;/a&gt; for “All Employees, Computer Systems Design and Related Services”. Click the “Edit Graph” button and select the “Add Line” tab to search for “All Employees, Total Nonfarm.” Don’t forget to click “Add data series.” For both selected series, change the units to &amp;#8220;Percent Change, Annual,&amp;#8221; with the aggregation method as “End of Period.” Last, change the date range to start in 1991-01-01.&lt;/p&gt; &lt;p&gt;Suggested by &lt;a href=&quot;https://www.federalreserve.gov/careers-internships.htm&quot;&gt;Maria Goffinet&lt;/a&gt;, &lt;a href=&quot;https://www.federalreserve.gov/careers-internships.htm&quot;&gt;Elena Roussanova&lt;/a&gt;, and &lt;a href=&quot;https://www.stlouisfed.org/research/information-services#diego&quot;&gt;Diego Mendez-Carbajo&lt;/a&gt;.&lt;/p&gt;","additional_content":""},{"title":"State minimum wages and cost of living","permalink":"https://fred.stlouisfed.org/blog/2026/08/state-minimum-wages-and-cost-of-living","date":"2026-08-17 08:00:00","content":"&lt;div class=&quot;embed-map&quot; style=&quot;width: 670px; height: 720px; overflow: visible;&quot;&gt;&lt;iframe style=&quot;overflow: visible !important; width: 670px; height: 720px !important;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?m=1XMgJ&amp;amp;width=670&amp;amp;height=640&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/div&gt; &lt;h2&gt;The takeaway&lt;/h2&gt; &lt;p&gt;The &lt;em&gt;federal&lt;/em&gt; minimum wage is the lowest hourly rate employers are required to pay workers. It&amp;#8217;s been &lt;a href=&quot;https://fredblog.stlouisfed.org/2024/01/how-binding-is-the-federal-minimum-wage/&quot;&gt;$7.25 per hour for a while now&lt;/a&gt;. &lt;em&gt;State&lt;/em&gt; minimum wages are a different story: Many are higher than the federal minimum, but the benefits can vary depending on cost of living in that location.&lt;/p&gt; &lt;h2&gt;Mapping state minimum wages&lt;/h2&gt; &lt;p&gt;Washington DC and 30 of the 50 US states have minimum wages higher than the federal minimum. The median minimum wage for US states, including DC, is currently $11.85.&lt;/p&gt; &lt;p&gt;Our FRED map above shows these minimum wages in 2026.&lt;/p&gt; &lt;p&gt;Gray shading indicates a state either follows the federal minimum wage of $7.25 or has chosen to set their minimum wage at the same rate.&lt;/p&gt; &lt;p&gt;Other colors indicate the state minimum wage is higher than the federal minimum, from the lowest in light yellow to the highest in dark green. As of 2026, the highest of these state minimum wages is $18.40 in DC and the lowest is $8.75 in West Virginia.&lt;/p&gt; &lt;div class=&quot;embed-map&quot; style=&quot;width: 670px; height: 720px; overflow: visible;&quot;&gt;&lt;iframe style=&quot;overflow: visible !important; width: 670px; height: 720px !important;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?m=1X9rc&amp;amp;width=670&amp;amp;height=640&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/div&gt; &lt;h2&gt;Adjusting for cost of living&lt;/h2&gt; &lt;p&gt;States consider many factors when setting their minimum wage, including cost of living. Our FRED map above shows one such measure: &lt;a href=&quot;https://fredblog.stlouisfed.org/2026/02/differences-in-cost-of-living-across-the-us/&quot;&gt;regional price parities (RPPs)&lt;/a&gt;.&lt;/p&gt; &lt;p&gt;RPPs assign values to the relative price level in each state compared with the national average, which has a value of 100. California is highest, at 110.72, which means prices there are 10.7% higher than the national average. Arkansas is lowest, at 86.94, with prices about 13.1% lower than average.&lt;/p&gt; &lt;p&gt;RPPs are determined by the average prices paid for a typical basket of goods and services, which is applied consistently across states and reflects what the average household would consume, not necessarily what the average minimum wage worker would consume. Note that state-level RPPs are an average for the entire state; but of course, cost of living can vary within a state. For example, Florida&amp;#8217;s RPP is 103.41. Within the state, though, RPPs vary from 95.47 in the Tampa area to 103.56 in the Miami area.&lt;/p&gt; &lt;p&gt;Adjusting the minimum wage by RPPs provides a measure of &lt;em&gt;real purchasing power&lt;/em&gt; across states. For example: DC has the highest minimum wage, but also a high cost of living. Its minimum wage value drops by about $1.66 to $16.74 once adjusted by its RPP. New Hampshire is one of the states with the lowest minimum wage ($7.25), which drops to $6.96 once adjusted by its RPP.&lt;/p&gt; &lt;p&gt;&lt;b&gt;How these maps were created&lt;/b&gt;: First map: Search &lt;a href=&quot;https://fred.stlouisfed.org/&quot;&gt;FRED&lt;/a&gt; for and select “State Minimum Wage Rate for Missouri” (series ID STTMINWGMO). Or any state, really. In the upper right, click “View Map” and then the blue “Edit Map” button. Click the light-yellow color (next to the less than or equal to 7.25) and change the color to gray (#999995) so all states with a minimum wage equal to or below $7.25 appear gray. Second map: Search FRED for and select “Regional Price Parities: All Items for Missouri” (series ID MORPPALL) and click “View Map.”&lt;/p&gt; &lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/careers/yourcareer/opportunities/internship-program&quot;&gt;Reagan Gilmore&lt;/a&gt; and &lt;a href=&quot;https://www.stlouisfed.org/research/economists/gascon&quot;&gt;Charles Gascon&lt;/a&gt;.&lt;/p&gt;   &lt;p /&gt;","additional_content":""},{"title":"What is the Texas ratio?","permalink":"https://fred.stlouisfed.org/blog/2026/08/what-is-the-texas-ratio","date":"2026-08-13 08:00:00","content":"&lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1XLQs&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;h2&gt;The name&lt;/h2&gt; &lt;p&gt;In the 1980s, Texas had a banking crisis whose causes included shocks in oil prices and real estate investments. In response, Gerard Cassidy of the Royal Bank of Canada developed the &lt;a href=&quot;https://ideas.repec.org/a/fip/feddfn/0003.html&quot;&gt;Texas ratio metric&lt;/a&gt; to assess a bank’s credit risk in that state.&lt;/p&gt; &lt;h2&gt;The definition&lt;/h2&gt; &lt;p&gt;The Texas ratio measures a bank’s nonperforming loans divided by the sum of tangible equity capital and allowance for losses on loans and leases.&lt;/p&gt; &lt;p&gt;Nonperforming loans consist of the following:&lt;/p&gt; &lt;ol&gt; &lt;li&gt;Nonaccrual loans, where a lender stops adding expected interest to their reported income.&lt;/li&gt; &lt;li&gt;Loans with payments 90 or more days past due.&lt;/li&gt; &lt;li&gt;Real estate assets acquired through foreclosure.&lt;/li&gt; &lt;/ol&gt; &lt;p&gt;Tangible equity capital represents the available capital cushion to absorb losses and is found by subtracting intangible assets from total bank equity capital. Allowance for loan losses represents funds set aside to cover expected loan losses.&lt;/p&gt; &lt;h2&gt;The interpretation&lt;/h2&gt; &lt;p&gt;The lower the ratio (that is, the closer to 0%), the smaller the risk of loan losses to a bank’s capital. The higher the ratio, especially if it exceeds 100%, the greater the risk of a bank being unable to cover its potential loan losses.&lt;/p&gt; &lt;h2&gt;The graphed data&lt;/h2&gt; &lt;p&gt;Our FRED graph shows the aggregated Texas ratio for all FDIC-insured commercial banks in the U.S. between the first quarter of 1984 and the first quarter of 2026. At the time of this writing, its value is 5.82%. That’s near the all-time low of 4.59% recorded during the second quarter of 2022.&lt;/p&gt; &lt;p&gt;Read more about the Texas ratio, including values by bank size, in &lt;a href=&quot;https://www.stlouisfed.org/on-the-economy/2025/nov/banking-analytics-taking-banks-risk-temperature-texas-ratio&quot;&gt;Banking Analytics: Understanding Credit Risk with the Texas Ratio&lt;/a&gt;.&lt;/p&gt; &lt;p&gt;&lt;b&gt;How this graph was created&lt;/b&gt;: Search &lt;a href=&quot;https://fred.stlouisfed.org/&quot;&gt;FRED&lt;/a&gt; for and select “Balance Sheet: Loans and Leases in Nonaccrual Status, Millions of U.S. Dollars, Not Seasonally Adjusted.” Click on the “Edit Graph” button and under the “Customize data” section in the “Edit Line” tab, search for “Balance Sheet: Loans and Leases 90 Days or More Past Due, Millions of U.S. Dollars, Not Seasonally Adjusted” and click “Add.” Repeat for “Balance Sheet: Total Assets: Other Real Estate Owned, Millions of U.S. Dollars, Not Seasonally Adjusted,” “Balance Sheet: Total Liabilities and Capital: Total Equity Capital: Total Bank Equity Capital, Millions of U.S. Dollars, Not Seasonally Adjusted,” “Balance Sheet: Total Assets: Intangible Assets, Millions of U.S. Dollars, Not Seasonally Adjusted,” and “Balance Sheet: Total Assets: Total Loans and Leases: Less: Reserve for Losses, Millions of U.S. Dollars, Not Seasonally Adjusted.” Enter the formula &lt;i&gt;100 * (a+b+c) / (d-e+f)&lt;/i&gt;.&lt;/p&gt; &lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/careers/yourcareer/opportunities/internship-program&quot;&gt;Steven Tian&lt;/a&gt; and &lt;a href=&quot;https://www.stlouisfed.org/research/information-services#diego&quot;&gt;Diego Mendez-Carbajo&lt;/a&gt;.&lt;/p&gt; ","additional_content":""},{"title":"Can small business owners access the credit they need?","permalink":"https://fred.stlouisfed.org/blog/2026/08/can-small-business-owners-access-the-credit-they-need","date":"2026-08-10 08:00:00","content":"&lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1Xltt&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;p&gt;&lt;strong&gt;The takeaway&lt;/strong&gt;&lt;/p&gt; &lt;p&gt;Small businesses with lower credit risk tend to receive all the financing they seek more often than businesses with higher credit risk, which may be newer, smaller, and more in need of financing.&lt;/p&gt; &lt;p&gt;&amp;nbsp;&lt;/p&gt; &lt;p&gt;&lt;strong&gt;Small business credit &lt;/strong&gt;&lt;/p&gt; &lt;p&gt;&lt;em&gt;Fed Small Business&lt;/em&gt; is a collection of resources related to, yes, small business. It provides economic research and analysis by the 12 Reserve Banks of the Federal Reserve System as well as the national Small Business Credit Survey (SBCS).&lt;/p&gt; &lt;p&gt;The SBCS asks firms with fewer than 500 employees how much financing their business sought and obtained in the past year. Our FRED graph above shows the share of firms applying for financing that were approved for the full amount they sought. Survey responses are available from 2016 through 2025.&lt;/p&gt; &lt;p&gt;These firms are sorted into three different categories of credit risk: low (solid blue line), medium (dashed green line), and high (dotted orange line).&lt;/p&gt; &lt;p&gt;As you might expect, firms with low credit risk consistently received the full amount of the financing they were seeking more frequently than firms with riskier credit profiles. As &lt;em&gt;Fed Small Business&lt;/em&gt; researchers &lt;a href=&quot;https://www.fedsmallbusiness.org/categories/credit-risk&quot;&gt;point out, &lt;/a&gt;“riskier firms are more often newer and smaller than those with stronger credit scores. As a result, it may be the case that businesses most in need of financing have the most difficulty accessing those funds.”&lt;/p&gt; &lt;p&gt;&amp;nbsp;&lt;/p&gt; &lt;p&gt;&lt;strong&gt;Small business details &lt;/strong&gt;&lt;/p&gt; &lt;p&gt;The &lt;a href=&quot;https://fred.stlouisfed.org/release?rid=1&quot;&gt;SBCS&lt;/a&gt; offers rich details about the industry, firm size, geographical location, and demographic characteristics of the owners. These data help tell some compelling stories. For example:&lt;/p&gt; &lt;ul&gt; &lt;li&gt;Small rural firms were consistently more likely to receive the full amount of financing compared with &lt;a href=&quot;https://fred.stlouisfed.org/graph/?g=1XqvH&quot;&gt;their urban counterparts&lt;/a&gt;.&lt;/li&gt; &lt;li&gt;Small firms with annual revenues above $1 million were more likely to receive the full amount of financing compared with &lt;a href=&quot;https://fred.stlouisfed.org/graph/?g=1XqIU&quot;&gt;firms with revenue below that threshold&lt;/a&gt;.&lt;/li&gt; &lt;li&gt;Small veteran-owned firms are generally at par with small non-veteran-owned firms regarding their full access to the financing requested. But &lt;a href=&quot;https://fred.stlouisfed.org/graph/?g=1Xr3k&quot;&gt;short-lived gaps&lt;/a&gt; between these two groups occasionally appear.&lt;/li&gt; &lt;/ul&gt; &lt;p&gt;&amp;nbsp;&lt;/p&gt; &lt;p&gt;&lt;a href=&quot;https://www.fedsmallbusiness.org/categories&quot;&gt;Learn&lt;/a&gt;&lt;a href=&quot;https://www.fedsmallbusiness.org/categories&quot;&gt; more&lt;/a&gt; about the demographics of small business owners.&lt;/p&gt; &lt;p&gt;&amp;nbsp;&lt;/p&gt; &lt;p&gt;&lt;b&gt;How this graph was created&lt;/b&gt;: Browse &lt;a href=&quot;https://fred.stlouisfed.org/&quot;&gt;FRED&lt;/a&gt; by release and select “Small Business Credit Survey” and its “Approved for New Financing” release table. Scroll to the section labeled “Credit risk” and check the boxes next to the series labeled “Low credit risk,” “Medium credit risk,” and “High credit risk.” Scroll to the bottom of the page and click “Add to Graph.” Repeat for the other demographics discussed.&lt;/p&gt; &lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/careers/yourcareer/opportunities/internship-program&quot;&gt;Krishna Meegada&lt;/a&gt; and &lt;a href=&quot;https://www.stlouisfed.org/research/information-services#diego&quot;&gt;Diego Mendez-Carbajo&lt;/a&gt;.&lt;/p&gt;   &lt;p /&gt;","additional_content":""},{"title":"What securities do FDIC-insured banks hold?","permalink":"https://fred.stlouisfed.org/blog/2026/08/what-securities-do-fdic-insured-banks-hold","date":"2026-08-06 08:00:00","content":"&lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1X8Db&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;p&gt;The &lt;a href=&quot;https://www.fdic.gov/quarterly-banking-profile&quot;&gt;quarterly banking profile&lt;/a&gt; of FDIC-insured institutions provides an overview of their aggregate financial condition, including data on bank earnings, loan and deposit activity, and asset quality. According to theses profiles, mortgage-backed securities make up more than half of the total assets held on their balance sheets.&lt;/p&gt; &lt;p&gt;Our FRED graph above shows the makeup of these institutions&amp;#8217; balance sheets between the first quarter of 1984 and the first quarter of 2026. The asset classes are as follows, in descending order of relative shares:&lt;/p&gt; &lt;ol&gt; &lt;li&gt;Mortgage-backed securities (blue area): bonds backed by pools of home mortgages (60.7%)&lt;/li&gt; &lt;li&gt;U.S. Treasury securities (orange area): debt issued by the US federal government (33.5%)&lt;/li&gt; &lt;li&gt;State and municipal securities (green area): bonds issued by states and local governments to fund public projects (5.8%)&lt;/li&gt; &lt;li&gt;Equity securities (purple area): shares of ownership in a corporation (0.0%)&lt;/li&gt; &lt;/ol&gt; &lt;p&gt;We can see that mortgage-backed securities consistently represent the lion’s share of assets. However, between 2008 and the time of this writing, the share of those securities has decreased while the share of US Treasury and state and municipal securities has increased. &lt;a href=&quot;https://ideas.repec.org/a/fip/fedker/96081.html&quot;&gt;Researchers at the Kansas City Fed&lt;/a&gt; point to changes in the regulatory environment and evolving preferences for risk to explain this changing mix.&lt;/p&gt; &lt;p&gt;These assets can also be classified as either trading securities or investment securities. Trading securities are intended to generate short-term financial gains and typically make up a small share of a bank’s total assets. Investment securities, on the other hand, make up the larger share of a bank’s total assets and typically have longer holding periods. Their type is reported on the balance sheet as either “held to maturity” (HTM) or “available for sale” (AFS).&lt;/p&gt; &lt;p&gt;Our second FRED graph below shows the proportions of HTM (blue area) and AFS securities (green area) held in FDIC-insured banks between the first quarter of 1994 and the first quarter of 2025.&lt;/p&gt; &lt;p&gt;&lt;iframe style=&quot;overflow: hidden; width: 670px; height: 525px;&quot; src=&quot;https://fred.stlouisfed.org/graph/graph-landing.php?g=1X8DZ&amp;amp;width=670&amp;amp;height=475&quot; frameborder=&quot;0&quot; scrolling=&quot;no&quot;&gt;&lt;/iframe&gt;&lt;/p&gt; &lt;p&gt;Since 1996, most of the investment securities are available for sale, meaning they are held for an indefinite period of time and could be sold before maturity. However, since 2010, the proportion of investment securities that banks intend to hold until expiration, or maturity, has increased. At the time of this writing, they amount to 39.8% of all investment assets.&lt;/p&gt; &lt;p&gt;The Kansas City Fed researchers mentioned above ascribe this changing pattern to a strategy to better protect the value of mandatory capital levels against financial risk.&lt;/p&gt; &lt;p&gt;&lt;b&gt;How these graphs were created&lt;/b&gt;: First graph: Browse &lt;a href=&quot;https://fred.stlouisfed.org/&quot;&gt;FRED&lt;/a&gt; data by source and navigate to “Federal Deposit Insurance Corporation.” Select the release “FDIC Quarterly Banking Profile” and the release table “Assets and Liabilities of FDIC-Insured Commercial Banks and Savings Institutions.” Scroll to the section labeled “Securities” and check the boxes next to the series labeled “U.S. Treasury Securities,” “Mortgage-Backed Securities,” “State and Municipal Securities,” and “Equity Securities.” Scroll to the bottom of the page and click “Add to Graph.” Click the “Edit Graph” button and select the “Format” tab to choose “Graph Type: Area” and “Stacking: Percent.”&lt;br /&gt;Second graph: Navigate to “Federal Deposit Insurance Corporation” source again to select the same release and release table. Again, scroll to the section labeled “Securities” and check the boxes next to the series labeled “Available for Sale (Fair Value)” and “Held to Maturity (Amortized Cost).” Click “Add to Graph.” Click “Edit Graph” and select “Format” to choose “Graph Type: Area” and “Stacking: Percent.”&lt;/p&gt; &lt;p&gt;Suggested by &lt;a href=&quot;https://www.stlouisfed.org/careers/yourcareer/opportunities/internship-program&quot;&gt;Joe Kledis&lt;/a&gt;, &lt;a href=&quot;https://www.stlouisfed.org/careers/yourcareer/opportunities/research-associates&quot;&gt;Collin Eldridge&lt;/a&gt;, &lt;a href=&quot;https://www.stlouisfed.org/careers/yourcareer/opportunities/research-associates&quot;&gt;Melanie LeTourneau&lt;/a&gt; and &lt;a href=&quot;https://www.stlouisfed.org/research/information-services#diego&quot;&gt;Diego Mendez-Carbajo&lt;/a&gt;.&lt;/p&gt;   &lt;p&gt;&lt;/p&gt; ","additional_content":""}]}</div>