FRBSF Economic Letters

Economic analysis for a general audience

Yifan Cao and Adam Hale Shapiro


Some closely watched measures of inflation expectations have been in gradual decline over the past five years. Over the same time, oil prices have fallen dramatically. Although the movements in energy prices are normally considered temporary, they appear to have played a large role in pushing down some longer-term forecasts for consumer price index inflation from professional forecasters. Analysis shows the drop in energy prices can explain about three-fourths of the decline in these professional inflation forecasts over the past five years.

View past FRBSF Economic Letters



Analysis of current economic developments and the outlook

SF Fed Forecast Preview

The SF Fed Forecast Preview is an advance release of the monthly SF Fed FedViews publication. Our forecasts of GDP, inflation, and unemployment will usually be released will usually be released on the second Tuesday of each month.

Western Economic Developments

Western Economic Developments is linked to via Fed in Print only.

Working Papers

The latest in economic research

Kathryn Holston, Thomas Laubach, and John C. Williams

U.S. estimates of the natural rate of interest—the real short-term rate that would prevail absent transitory disturbances—have declined dramatically since the start of the global financial crisis. Applying the Laubach-Williams (2003) methodology to the United States, Canada, the Euro Area, and the United Kingdom, we find large declines in trend GDP growth and natural rates of interest over the past 25 years in all four economies. These estimates display substantial comovement over time, suggesting an important role for global factors.

View past Working Papers