Sinem Hacıoğlu Hoke and Leo FelerThis paper estimates the effects of the 2025 U.S. tariffs on household spending using transaction-level data linked to tariff exposure and a tariff sentiment survey. Comparing high versus low tariff-exposed categories, we find 15 to 20 percent price pass-through. At the mean increase in tariff exposure, prices rise by 1 to 2 percent while spending falls by roughly 4 percent.
Maximilian Grimm, Moritz Schularick, and Emil VernerFinancial liberalization is often seen as a way to deepen credit markets and stimulate economic growth, but it may also fuel credit booms that end in crisis. We construct a new cross-country database of banking regulation policies covering 21 regulatory indicators for 18 advanced economies since World War II. We distinguish liberalizations that directly relax constraints on credit supply from broader financial reforms.
Edward Herbst, Scott Konzem, and Cristina ScofieldWe comprehensively document 1,265 Federal Reserve staff alternative scenarios presented to the Federal Open Market Committee in publicly released materials from 1968 to 2020. Scenarios grew in frequency and sophistication, typically spanning a range of outcomes around the baseline.
Dong Hwan Oh and Andrew J. PattonWe propose a new measure of mutual fund manager ability: "efficiency" is the ability to accrue the risk premium associated with a risk factor. The familiar abnormal return, or alpha, is shown to be the sum of two distinct measures of ability: "aggregate efficiency" which is the beta-weighted sum of the fund's (in)efficiencies across risk factors, and "skill," the component that is unrelated to factor exposures. Using a panel of U.S.
Abhik Bhatt, Anthony M. Diercks, Benjamin Eyal, and Arsenios SkaperdasThis paper uses a natural experiment to measure the causal effect of an expected debt-financed fiscal stimulus on interest rates. We find that a 1 percentage point increase in the expected US debt-to-GDP ratio leads to an increase of about 1-2 basis points in the longer-run neutral rate (r∗) and of about 2–3 basis points in the 10-year Treasury term premium.
Celso Brunetti, Christoph FreiWe study the rise of nonbank financial intermediation and its implications for systemic risk. We develop a structural network model of banks and nonbank financial institutions (NBFIs) that decomposes intermediation into a capacity channel, driven by bank balance-sheet constraints, and a reliance channel, reflecting NBFI funding reliance. Using U.S. banking confidential supervisory data, we estimate key structural parameters and quantify both channels.
Ryan Byun, Bennett Fees, Margaret M. Jacobson, and Todd B. WalkerCentral bank communications, particularly FOMC statements and press conferences, play a crucial role in shaping financial market expectations. Using large language models to quantify central bank content, this paper demonstrates how sentiment aligns with traditional market-based monetary policy measures. We show that press conferences correlate with future policy to a greater extent than other communications.
Sai MaUsing microdata from the Michigan Survey of Consumers, we study how within-household reallocations of attention across news affect inflation expectation bias, measured relative to a real-time, machine-learning full-information benchmark. Shifting attention toward unfavorable (favorable) economic news increases (decreases) forecast bias substantially, while dropping attention to an unfavorable topic has little effect.
Sriya Anbil, Sebastian Infante, Zeynep SenyuzIn an ample-reserves framework, administered rates anchor money markets but suppress information from unsecured interbank trading. We recover that information by isolating the small interbank segment of the federal funds market.
Celso Brunetti, Jeffery H. Harris, Ioannis SpyridopoulosNo, in the mortgage market. Using confidential micro-level data combining mortgage contracts with credit and repayment records for 44 million loans spanning 5,000 bank mergers over nearly three decades, we find no changes to mortgage rates, approval rates, or delinquency rates. Local mortgage markets remain remarkably competitive despite consolidation, averaging over 100 active lenders in each county every post-merger quarter.
