Economics

The Saturated Level of Reserves or efficient level of reserves, is the point which the opportunity cost for banks to hold reserves disappears, and became indifferent towards holding more reserves. The reserve demand curve beyond this point becomes close to horizontal.

Federal Reserve announced yesterday that it will start purchasing Treasury bills from Oct 15 (Tuesday) until at least the second quarter of next year.

Or, to frame the question in a more technical way: is tipflation even counted as part of Consumer Price Index (CPI) inflation?

While GDP rebounded by 0.65% in Q3 (2.6% annualized), the expansion was driven almost entirely by a 2.2% drop in imports.

DSGE is a methodology for a wide range of macroeconomics models. One of the most common formulations is the so-called New Keynesian model. New Keynesian economics can be interpreted as an effort to combine the methodological tools developed by real business cycle theory with some of the central tenets of Keynesian economics tracing back to Keynes’ own General Theory.

In recent months, the Global Economic Policy Uncertainty index has risen to a level much higher than periods around the 911 Terrorist Attack or the 2008 Financial Crisis, hence the conclusion that the economic policy is unprecedently uncertain now. But here is why you might not have to worry.

Olivier Blanchard a list of things that macroeconomists normally agreed on and need no further discussions.

The Federal Reserve announced after the December meeting that it removed the aggregate limit on the Standing Repo Facility (SRF). Repo rates spiked toward the end of the week, with SOFR and the Tri-party General Collateral rate (TGCR) reaching 4.12% and 4.08% on Friday, respectively, breaching the Federal Reserve's overnight interest rate target range.

The latest SESFOD shows that the credit terms offered to counterparties for both securities financing and OTC derivative transactions is further tightened.

Inflation projections by Fed officials show that PCE inflation will not reach 2% by the end of 2025. Why the Fed expects to cut rate next year then?