Tyler Atkinson

2 months ago | dallasfed.org | Tyler Atkinson |Ron Mau

January inflation data were stronger in 2023 and 2024 than forecasters expected, even after more encouraging results had been reported for the ends of 2022 and 2023. Rather than reflecting seasonal adjustment difficulties, this pattern may be caused by a large share of firms changing prices at the start of a new year. If this is the case, first-quarter inflation data may exhibit greater persistence and sensitivity to swings in the business cycle.

Dec 3, 2024 | dallasfed.org | Tyler Atkinson |Prithvi Kalkunte

Real (inflation-adjusted) GDP grew strongly during the second and third quarters of 2024, increasing at an annualized pace of 2.9 percent. Yet, the unemployment rate also rose 0.4 percentage points, an unusually large amount except during recessions. Some analysts have noted a tendency for downward revisions of GDP growth heading into a recession. They argue for greater emphasis on labor market indicators when assessing cyclical strength.

Oct 7, 2024 | dallasfed.org | Tyler Atkinson

The U.S. unemployment rate has increased gradually over the past year, from a three-month average of 3.7 percent in September 2023 to 4.2 percent in September 2024. Historically, that sort of increase is a reliable predictor of recession. According to the Sahm Rule, when the three-month average unemployment rate rises more than a half percentage point from the minimum rate over 12 months, a recession is likely, followed by larger unemployment increases.

Aug 31, 2024 | hudl.com | Tyler Atkinson

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Jul 16, 2024 | dallasfed.org | Tyler Atkinson |Ron Mau

The Phillips curve describes the relationship between slack and inflation. In the short run, running the economy hot, or with output growth above potential, comes with the cost of additional inflation. But policymakers cannot exploit this relationship forever because the public will come to expect a higher level of inflation for any given level of output. That is, the statistical relationship between slack and inflation shifts due to changes in policy behavior—an example of the Lucas critique.