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June 2010 Tealbook Book A Tables and Charts


Domestic Economic Developments and Outlook

Key Background Factors Underlying the Baseline Staff Projection

Figure: Federal Funds Rate

Line chart, 2006 to 2011. Unit is percent. Data are quarterly average. The projection period is marked by a vertical blue bar from 2010:Q2 to the end of the timeline. There are four series, "Current Tealbook," "April Tealbook," "Market, mean," and "Market, mode." The series begin at about 4.5 and generally increase together to about 5.25 in late 2006. They remain about constant until late 2007 then generally decrease together to about 0 in 2009. Market, mode, Current Tealbook, and April Tealbook remain about constant to the end of the timeline. Market, mean generally increases ending at about 1.

Figure: Long-Term Interest Rates

Line chart, 2006 to 2011. Unit is percent. Data are quarterly average. The projection period is marked by a vertical blue bar from 2010:Q2 to the end of the timeline. There are six series, "BBB corporate yield -- Current," "BBB corporate yield -- Previous Tealbook," "Confirming mortgage rate -- Current," "Confirming mortgage rate -- Previous Tealbook," "10-year treasury yield -- Current" and "10-year treasury yield -- Previous Tealbook." BBB corporate yield -- Current and BBB Corporate Yield -- Previous Tealbook begin at about 6 and generally increase together to about 10 in mid-2008. They generally decrease together to about 6 in mid-2010 and remain about constant to the end of the timeline. Confirming mortgage rate -- Current and Confirming Mortgage Rate -- Previous Tealbook begin at about 6 and fluctuate but remain about constant until late 2008. They generally decrease together to about 5 in late 2010 then generally increase together ending at about 6. 10-year treasury yield -- Current and 10-year Treasury Yield -- Previous Tealbook begin at about 5 and generally decrease together to about 3 in early 2009. They generally increase together to about 4 in early 2010 then generally decrease together to about 3.5 in mid-2010. They generally increase together ending at about 4.5.

Figure: Equity Prices

Line chart, 2006 to 2011. Unit is 2006:Q1 = 100, ratio scale. Data are quarter end. The projection period is marked by a vertical blue bar from 2010:Q2 to the end of the timeline. There are two series, "Dow Jones Total Stock Market Index -- Current," and "Dow Jones Total Stock Market Index -- Previous Tealbook." They begin at about 100 and generally increase together to about 120 in mid-2007. They generally decrease together to about 60 in early 2009 then generally increase together ending at about 115.

Figure: House Prices

Line chart, 2006 to 2011. Unit is 2006:Q1 = 100, ratio scale. Data are quarterly. The projection period is marked by a vertical blue bar from 2010:Q2 to the end of the timeline. There are two series, "Loan Performance Index -- Current," and "Loan Performance Index -- Previous Tealbook." The series begin at about 100 and generally decrease together to about 70 in early 2009. They remain about constant to the end of the timeline.

Figure: Crude Oil Prices

Line chart, 2006 to 2011. Unit is dollars per barrel. Data are quarterly average. The projection period is marked by a vertical blue bar from 2010:Q2 to the end of the timeline. There are series, "West Texas Intermediate -- Current," and "West Texas Intermediate -- Previous Tealbook." They begin at about 60 and generally increase together to about 120 in early 2008. They generally decrease together to about 40 in early 2009 then West Texas Intermediate -- Current generally increases ending at about 80. West Texas Intermediate -- Previous Tealbook generally increases ending at about 90.

Figure: Broad Real Dollar

Line chart, 2006 to 2011. Unit is 2006:Q1=100. Data are quarterly average. The projection period is marked by a vertical blue bar from 2010:Q2 to the end of the timeline. There are two series, "Current" and "Previous Tealbook." The series begin at about 100 and generally decrease together to about 85 in early 2008. They generally increase together to about 98 in early 2009 then generally decrease together to about 90 in late 2009. They generally increase together to about 93 in late 2010. Current generally increases to about 93 in late 2010 then generally decreases ending at about 85. Tealbook generally decreases ending at about 85.

Note: In each panel, shading represents the projection period, which begins in 2010:Q2.


[Box:] Staff Forecast of Residential House Prices

Figure: House Prices

Line chart, 2002 to 2010. Unit is 2006:Q1=100. Data are quarterly. There is a vertical blue bar from early 2010 to the end of the timeline. The series begins at about 60 and generally increases to about 100 in early 2006. It generally decreases to about 70 in early 2009 and remains about constant to the end of the timeline.

Source. First American LoanPerformance.


House Prices
(Percent change, Q4/Q4)
2008 2009 2010 2011
Current -17.6 -3.2 -2.6 .6
Previous -17.7 -3.3 -3.0 1.0

Source: First American LoanPerformance.


Figure: Over/Under Valuation of Single-Family Homes

Line chart, 1988 to 2010. Unit is percent. Data are quarterly. There is a vertical blue bar from early 2010 to the end of the timeline. The series begins at about 0 and generally increases to about 10 in early 1999. It generally decreases to about -10 in early 1997 then generally increases to about 45 in early 2006. It generally decreases ending at about -10.

Source. Staff estimates from First American LoanPerformance and Bureau of Labor Statistics data.


Summary of the Near-Term Outlook

(Percent change at annual rate except as noted)
Measure 2010:Q1 2010:Q2
Previous
Tealbook
Current
Tealbook
Previous
Tealbook
Current
Tealbook
Real GDP 2.9 3.1 3.5 3.6
Private domestic final purchases 3.4 3.0 3.6 4.5
Personal consumption expenditures 3.6 3.4 2.1 2.9
Residential investment -15.7 -10.6 22.3 18.7
Nonres. structures -10.6 -15.2 .4 -.8
Equipment and software 17.0 13.5 15.8 20.3
Federal purchases .9 1.2 8.4 6.9
State and local purchases -4.2 -3.9 -.5 -.6
Contribution to change in real GDP
(percentage points)
Inventory investment .7 1.9 -.2 -.3
Net exports -.2 -.9 .1 -.2


Recent Nonfinancial Developments (1)

Figure: Changes in Private Payroll Employment

Line chart, 2001 to 2011. Unit is thousands of employees. 0 on the scale is marked by a horizontal black line. The end of the series is labeled May. The series begins at about -50 and fluctuates but generally increases to about 300 in early 2004. It fluctuates but remains about constant until early 2008. It generally decreases to about -800 in early 2009 then fluctuates but generally increases to about 250 in late 2009. It generally decreases ending at about 0. 3-month moving average is shown as a solid red line the runs about concurrently with the series.

Figure: Unemployment rate

Line chart, 2001 to 2011. Unit is percent. The end of the series is labeled May. The series begins at about 4 and fluctuates but generally increases to about 6.25 in late 2003. It fluctuates but generally decreases to about 4 in early 2007 then generally increases to about 10 in late 2009. It generally decreases ending at about 9.5.

Figure: Manufacturing IP excluding Motor Vehicles and Parts

Line chart, 2001 to 2011. Unit is 3-month percent change, annual rate. 0 on the scale is marked by a horizontal black line. The end of the series is labeled May. The series begins at about -5 and generally decreases to about -10 in late 2001. It fluctuates but generally increases to about 12 in early 2006 then fluctuates but generally decreases to about -25 in early 2009. It fluctuates but generally increases ending at about 12.

Figure: Production of Light Motor Vehicles

Line chart, 2001 to 2011. Unit is millions of units, annual rate. The end of the series is labeled May. 2010:Q3 schedules are represented by a circle at the end of the series. The series begins at about 11 and fluctuates but generally increases to about 13 in early 2003. It fluctuates but remains about constant until late 2005. It fluctuates but generally decreases to about 4 in early 2009. It generally increases ending at about 8.

Note: Schedules data are from Ward's Communications.


Recent Nonfinancial Developments (2)

Figure: Real PCE Goods excluding Motor Vehicles

Line chart, 2001 to 2010. Unit is billions of chained (2005) dollars. The end of the series is labeled May. The series begins at about 2300 and fluctuates but generally increases to about 2900 in late 2007. It generally decreases to about 2800 in early 2008 then generally increases ending at about 3,000.

Note: Figures for March, April, and May are staff estimates based on available source data.

Figure: Sales of Light Motor Vehicles

Line chart, 2001 to 2010. Unit is millions of units, annual rate. The end of the series is labeled May. The series begins at about 18 and generally increases to about 22 in late 2001. It generally decreases to about 15 in early 2002 then fluctuates but remains about constant until mid-2005. It generally increases to about 21 then generally decreases to about 9 in early 2009. It generally increases to about 15 in mid-2009 then generally increases ending at about 12.

Figure: Single-Family Housing Starts

Line chart, 2001 to 2010. Unit is thousands of units, annual rate. The end of the series is labeled May. There are two series, "Starts" and "Adjusted Permits." Both series begin at about 1200 and generally increase together to about 1800 in mid-2005. They generally decrease together to about 300 in late 2008. They generally increases together to about 600 in early 2010 then generally decrease together ending at about 450.

Note: Adjusted permits equal permits plus starts outside of permit-issuing areas.

Figure: Single-Family Home Sales

Line chart, 2001 to 2010. Unit is thousands of units, annual rate. The end of the series is labeled April. There are two series, "New (right scale)" and "Existing (left scale)." New begins at about 900 and fluctuates but generally increases to about 1400 in mid-2005. It generally decreases to about 300 in early 2008 then generally increases ending at about 500. Existing begins at about 4500 and generally increases to about 6400 in late 2005. It generally decreases to about 4000 in late 2008 then generally increases to about 5600 in late 2009. It generally decreases to about 4400 in early 2010 then generally increases ending at about 5200.

Figure: Nondefense Capital Goods Excluding aircraft

Line chart, 2001 to 2010. Unit is billions of dollars. The end of the series is labeled April. There are two series, "Orders" and "Shipments." Orders begins at about 63 and fluctuates but generally decreases to about 45 in early 2002. It fluctuates but generally increases to about 72 in late 2007 then generally decreases to about 47 in early 2009. It fluctuates but generally increases ending at about 60. Shipments begins at about 63 and fluctuates but generally decreases to about 50 in early 2003. It fluctuates but generally increases to about 67 in late 2008 then generally decreases to about 53 in early 2009. It fluctuates but generally increases ending at about 60.

Figure: Nonresidential Construction Put in Place

Line chart, 2001 to 2010. Unit is billions of chained (2005) dollars. The end of the series is labeled April. The series begins at about 275 and generally decreases to about 225 in late 2002. It generally increases to about 425 in late 2008 then generally decreases ending at about 300.


Recent Nonfinancial Developments (3)

Figure: Inventory Ratios excluding Motor Vehicles

Line chart, 2001 to 2010. Unit is months. The end of the upper series is labeled May. The end of the lower series is labeled April. There are two series, "Staff flow-of goods system" and "Census book-value data." Staff flow-of-goods system begins at about 1.7 and fluctuates but generally decreases to about 1.5 in miod-2008. It generally increases to about 1.6 in early 2009 then generally decreases ending at about 1.5. Census book-value data begins at about 1.4 and generally decreases to about 1.2 in late 2005. It generally increases to about 1.4 in late 2008 then generally decreases ending at about 1.2.

Note: Flow-of-goods system covers total industry ex. motor vehicles and parts, and inventories are relative to consumption. Census data cover manufacturing and trade ex. motor vehicles and parts, and inventories are relative to sales.

Figure: Defense Spending

Line chart, 2001 to 2010. Unit is billions of chained (2005) dollars. The end of the first series is labeled May. The end of the second series is labeled Q1. There are two series, "Unified" and "NIPA." unified begins at about 375 and fluctuates but generally increases to about 700 in late 2009. It fluctuates but generally decreases ending at about 600. NIPA begins at about 375 and fluctuates but generally increases ending at about 625.

Note: The unified series is seasonally adjusted and deflated by BEA prices. The NIPA series excludes the consumption of fixed capital.

Figure: Trade Balance

Line chart, 2001-2010. Unit is billions of dollars. The end of the series is labeled April. The series begins at about -35 and fluctuates but generally decreases to about -70 in early 2006. It fluctuates but generally increases to about -65 in mid-2006 then generally decreases to about -70 in mid-2008. It generally increases to about -20 in early 2009 then generally decreases ending at about -40.

Figure: Exports and Non-Oil Imports

Line chart, 2001 to 2010. Unit is billions of dollars. The end of the series is labeled April. There are two series, "Non-Oil Imports" and "Exports." Non-Oil Imports begins at about 115 and generally increases to about 180 in mid-2008. It generally decreases to about 130 in early 2009 then generally increases ending at about 160. Exports begins at about 90 and generally increases to about 160 in early 2008. It generally decreases to about 120 in early 2009 then generally increases ending at about 150.

Figure: Total PCE Prices

Line chart, 2001 to 2010. Unit is percent. 0 on the scale is marked by a horizontal line. The end of the series is labeled April. There are two series, "12-month change" and "3-month change." 3-month changes are at an annual rate. 12-month change begins at about begins at about 3 and fluctuates but gradually increases to about 4 in early 2008. It generally decreases to about -1 in early 2009 then generally increases ending at about 2. 3-month change begins at about 3 and fluctuates but remains about constant until mid-2005. It increases to about 8 then decreases to about -1 in late 2005. It fluctuates but generally increases to about 7 in early 2008 then decreases to about -10 in late 2008. It generally increases to about 4 in mid-2009 then generally decreases ending at about 1.

Note: 3-month changes are at an annual rate.

Figure: PCE Prices excluding Food and Energy

Line chart, 2001 to 2010. Unit is percent. 0 on the scale is marked by a horizontal line. The end of the series is labeled April. There are two series, "12-month change" and "3-month change." 3-month changes are at an annual rate. 12-month change begins at about 2 and fluctuates but gradually increases to about 2.5 in early 2008. It generally decreases ending at about 1. 3-month change begins at about 2.5 and generally decreases to about -1 in late 2001. It generally increases to about 4 in early 2002 then generally decreases to about 1 in late 2002. It generally fluctuates between about 1 and about 3 until late 2008 when it generally decreases to about 0. It generally increases to about 2 in late 2009 then generally decreases ending at about 1.

Note: 3-month changes are at an annual rate.


Projections of Real GDP and Related Components

(Percent change at annual rate from end of preceding period except as noted)
Measure 2008 2009 2010 2011
H1 H2
Real GDP -1.9 .1 3.4 3.0 3.7
Previous Tealbook -1.9 .1 3.2 3.7 4.4
Final sales -1.4 -.1 2.6 2.6 3.4
Previous Tealbook -1.4 -.1 3.0 3.1 4.1
Personal consumption expenditures -1.8 1.0 3.1 2.3 3.1
Previous Tealbook -1.8 1.0 2.8 2.8 3.5
Residential investment -21.0 -12.5 3.0 4.9 17.1
Previous Tealbook -21.0 -12.5 1.5 3.1 19.8
Nonresidential structures 3.2 -25.3 -8.3 -1.2 -.2
Previous Tealbook 3.2 -25.3 -5.3 .3 1.1
Equipment and software -10.7 -7.5 16.8 11.3 10.8
Previous Tealbook -10.7 -7.5 16.4 13.9 13.2
Federal purchases 8.9 3.6 4.0 3.0 1.4
Previous Tealbook 8.9 3.6 4.6 2.7 .8
State and local puchases -.3 -.1 -2.3 .2 .5
Previous Tealbook -.3 -.1 -2.4 .4 .7
Exports -3.4 -.7 9.7 7.7 7.4
Previous Tealbook -3.4 -.7 8.7 9.4 9.1
Imports -6.8 -6.6 11.5 6.9 6.9
Previous Tealbook -6.8 -6.6 7.0 8.5 7.4
Contributions to change in real GDP
(percentage points)
Inventory change -.5 .1 .8 .4 .3
Previous Tealbook -.5 .1 .3 .7 .3
Net exports .7 1.0 -.5 -.1 -.2
Previous Tealbook .7 1.0 .0 -.2 .0

Figure: Real GDP

Line chart, 1980 to 2011. Unit is 4-quarter percent change. 0 on the scale is marked by a horizontal line. There is a vertical blue shaded bar marking the period of 2010 to 2011. The series begins at about 1.5 and decreases to about -2 in late 1980. It generally increases to about 4.5 in late 1981 then generally decreases to about -3 in mid-1982. It generally increases to about 8.5 in early b1984 then fluctuates but generally decreases to about -1 in late 1990. It fluctuates but generally increases to about 7 in early 2000. It generally decreases to about .5 in late 2001 then generally increases to about 4 in early 2004. It fluctuates but generally decreases to about -4 in early 2009 then generally increases ending at about 4.

Note: The shaded bars indicate a period of business recession as defined by the National Bureau of Economic Research (NBER): January 1980-July 1980, July 1981-November 1982, July 1990-March 1991, and March 2001-November 2001. The vertical line represents the last business cycle peak as defined by the NBER (December 2007).


Components of Final Demand

Figure: Personal Consumption Expenditures

Line chart, 2006 to 2011. Unit is 4-quarter percent change. 0 on the scale is marked by a horizontal line. There is a vertical blue bar marking the period 2010 to 2011. There are two series, "Current" and "Previous Tealbook." Both series begin at about 3 and generally decrease together to about 2.5 in mid-2006. They generally increase together to about 3.5 in late 2006 then generally decrease together to about -2 in mid-2009. They generally increase together to about 2 in early 2010, then Current generally increases ending at about 3 and Previous Tealbook generally increases to about 3.5.

Figure: Residential Investment

Line chart, 2006 to 2011. Unit is 4-quarter percent change. 0 on the scale is marked by a horizontal line. There is a vertical blue bar marking the period 2010 to 2011. There are two series, "Current" and "Previous Tealbook." Both series begin at about 2.5 then generally decrease together to about -25 in mid-2009. They generally increase together to about 5 in early 2010 then generally decrease together to about 0 in mid-2010. Current generally increases ending at about 17 and Previous Tealbook generally increases ending at about 20.

Figure: Equipment and Software

Line chart, 2006 to 2011. Unit is 4-quarter percent change. 0 on the scale is marked by a horizontal line. There is a vertical blue bar marking the period 2010 to 2011. There are two series, "Current" and "Previous Tealbook." Both series begin at about 10 and generally decrease together to about -20 in early 2009. They generally increase together to about 15 in early 2010 then Current generally decreases ending at about 10 and Previous Tealbook generally decreases ending at about 12.

Figure: Nonresidential Structures

Line chart, 2006 to 2011. Unit is 4-quarter percent change. 0 on the scale is marked by a horizontal line. There is a vertical blue bar marking the period 2010 to 2011. There are two series, "Current" and "Previous Tealbook." Both series begin at about 2.5 and generally increase together to about 20 in late 2007. They generally decrease together to about -25 in late 2009 then generally increase together to about 0 in late 2010. They remain about constant to the end of the timeline.

Figure: Government Consumption & Investment

Line chart, 2006 to 2011. Unit is 4-quarter percent change. 0 on the scale is marked by a horizontal line. There is a vertical blue bar marking the period 2010 to 2011. There are two series, "Current" and "Previous Tealbook." Both series begin at about 1.5 and generally decrease together to about 0.75 in mid-2006. They generally increase together to about 1.5 in late 2006 then generally decrease together to about 0.5 in early 2007. They generally increase together to about 3.0 in late 2008 then generally decrease together to about 0.25 in mid-2010. The generally increase together to about 1.5 in early 2011 then generally decrease together ending at about 1.

Figure: Exports and Imports

Line chart, 2006 to 2011. Unit is 4-quarter percent change. 0 on the scale is marked by a horizontal line. There is a vertical blue bar marking the period 2010 to 2011. There are four series, "Exports -- Current," "Exports -- Previous Tealbook," "Imports -- Current," and "Imports -- Previous Tealbook." Exports -- Current and Exports -- Previous Tealbook begin at about 9 and generally increase together to about 10 in early 2007. They generally decrease together to about 6 in in mid-2007 then generally increase together to about 10 in late 2007. They fluctuate but remain about constant until mid-2008 then generally decrease together to about -15 in mid-2009. They generally increase together to about 15 in early 2010 then Exports -- Current generally decreases ending at about 7 and Exports -- Previous Tealbook generally decreases ending at about 10. Imports -- Current and Imports -- Previous Tealbook begin at about 6 and generally decrease together to about -20 in mid-2009. Imports -- Current then generally increases to about 15 in early 2010 and Imports -- Previous Tealbook generally increases to about 12 in early 2010. Both series generally decrease ending at about 7.


Aspects of the Medium-Term Projection

Figure: Personal Saving Rate

Line chart, 1990 to 2012. Unit is percent. There is a vertical blue bar marking the period 2010 to 2011. There are two series, "Current" and "Previous Tealbook." Both series begin at about 6.5 and fluctuate but generally increase together to about 7.5 in late 1992. They fluctuate but generally decrease together to about 4.5 in late 1997 then generally increase together to about 6 in early 1998. They generally decrease together to about 2 in early 2001 then generally increase together to about 4 in mid-2001. They fluctuate but remain about constant until late 2004. They generally decrease together to about 1 in late 2005 then generally increase together to about 2 in late 2006. They generally decrease together to about 1 in early 2008 then generally increase together to about 6 in early 2009 then generally decrease together ending at about 4.

Figure: Wealth-to-Income Ratio

Line chart, 1990 to 2012. Unit is a ratio. There is a vertical blue bar marking the period 2010 to 2011. There are two series, "Current" and "Previous Tealbook." Both series begin at about 4.8 and generally increase together to about 6.3 in early 2000. They generally decrease together to about 5.0 in early 2002 then generally increase together to about 6.4 in early 2007. They generally decrease together to about 4.4 in early 2009 then Current generally increases to about 4.8 and Previous Tealbook generally increases ending at about 5.1.

Note: Household net worth as a ratio to disposable personal income.

Figure: Single-Family Housing Starts

Line chart, 1990 to 2012. Unit is millions of Units. There is a vertical blue bar marking the period 2010 to 2011. There are two series, "Current" and "Previous Tealbook." Both series begin at about 1.00 and generally decrease together to about 0.75 in early 1991. They generally increase together to about 1.75 in late 2005 then generally decrease together to about 0.3 in late 2008. They generally increase ending at about 0.85.

Figure: Equipment and Software Spending

Line chart, 1990 to 2012. Unit is share of nominal GDP. There is a vertical blue bar marking the period 2010 to 2011. There are two series, "Current" and "Previous Tealbook." Both series begin at about 7.5 and generally decrease to about 6.75 in early 1992. They fluctuate but generally increase together to about 9.5 in early 2000 then generally decrease together to about 7.5 in late 2003. They generally increase together to about 8.0 in early 2005 then generally decrease together to about 6.25 in late 2009. They generally increase together ending at about 7.5.

Figure: Federal Surplus/Deficit

Line chart, 1990 to 2012. Unit is share of nominal GDP. 0 on the scale is marked by a horizontal line. There is a vertical blue bar marking the period 2010 to 2011. There are two series, "Current" and "Previous Tealbook." Both series begin at about -4 and generally decrease together to about -5 in late 1992. They generally increase together to about 2 in mid-2000 then generally decrease together to about -4 in early 2004. They generally increase together to about -2 in early 2007 then generally decrease to about -10 in late 2009. They generally increase together ending at about -8.

Note: Share of federal government surplus/deficit is shown as a 4-quarter moving average.

Figure: Current Account Surplus/Deficit

Line chart, 1990 to 2012. Unit is share of nominal GDP. 0 on the scale is marked by a horizontal line. There is a vertical blue bar marking the period 2010 to 2011. There are two series, "Current" and "Previous Tealbook." Both series begin at about -1.5 and generally increase to about 1 in early 1991. They generally decrease together to about -7 in late 2005 then generally increase together to about -3 in early 2009. Current generally decreases ending at about -3.5 and Previous Tealbook generally decreases ending at about -3.

Note: The shaded bars indicate a period of business recession as defined by the National Bureau of Economic Research (NBER): July 1990-March 1991, and March 2001-November 2001. The vertical lines represent the last business cycle peak as defined by the NBER (December 2007).


[Box:] The Saving Rate in the Staff Projection

Figure: Saving Rate and Household Net Worth

Line chart, 1965 to 2011. Unit is percent. There is a vertical blue bar marking the period 2010 to 2011. There are two series, "Saving rate (right)" and "Household net worth to DPI (left)." Saving rate begins at about 8 and fluctuates but generally increases to about 12.5 in early 1975. It fluctuates but generally decreases to about 8 in early 1977. It fluctuates but generally increases to about 12 in late 1981 then fluctuates but generally decreases to about 1 in early 2008. It generally increases to about 5.5 in early 2009 then generally decreases ending at about 4. Household net worth to DPI begins at about 5 and generally decreases to about 4.25 in early 1966. It generally increases to about 5 in late 1968 then generally decreases to about 4 in early 1974. It fluctuates but generally increases to about 6.25 in early 2000 then generally decreases to about 5 in late 2002. It generally increases to about 6.5 in early 2007 then generally decreases to about 4.5 in early 2009. It generally increases ending at about 5.

Source: U.S. Bureau of Economic Analysis for saving rate and DPI; Federal Reserve Board for household net worth.

Figure: Ratio of Transfer Payments to Disposable Income

Line chart, 1990 to 2011. Unit is a ratio. There is a vertical blue bar marking the period 2010 to 2011. The series begins at about 0.14 and generally increases to about 0.16 in early 1993. It fluctuates but remains about constant until mid-1996. It generally decreases to about 0.145 in late 1999 then generally increases to about 0.20 in early 2010. It generally decreases ending at just below 0.20.

Source: U.S. Bureau of Economic Analysis.

Figure: Consumer Sentiment

Line chart, 2000 to 2010. Unit is an index. The end of the series is labeled June (p). The series begins at about 110 and generally decreases to about 80 in mid-2001. It generally increases to about 95 in mid-2002 then generally decreases to about 75 in early 2006. It generally increases to about 105 in late 2003 then generally decreases to about 75 in late 2005.It generally increases to about 95 in early 2007 then generally decreases to about 55 in early 2008. It increases to about 70 in early 2008 then decreases to about 55 in late 2008. It generally increases ending at about 75.

Source: Thomson Reuters/University of Michigan Survey of Consumers.


Decomposition of Potential GDP

(Percent change, Q4 to Q4, except as noted)
Measure 1974-1995 1996-2000 2001-2007 2008 2009 2010 2011
Potential GDP 3.0 3.4 2.7 2.7 2.7 2.3 2.4
Previous Tealbook 3.0 3.4 2.7 2.7 2.7 2.3 2.5
Selected contributions1
Structural labor productivity 1.5 2.5 2.6 2.3 2.6 1.8 2.0
Previous Tealbook 1.5 2.5 2.6 2.3 2.6 1.8 2.1
Capital deepening .7 1.5 .7 .5 .0 .2 .5
Previous Tealbook .7 1.5 .7 .5 .0 .2 .6
Multifactor productivity .5 .7 1.6 1.6 2.4 1.5 1.4
Previous Tealbook .5 .7 1.6 1.6 2.4 1.5 1.4
Trend hours 1.7 1.1 .9 .8 .5 .8 .8
Previous Tealbook 1.7 1.1 .9 .8 .5 .8 .8
Labor force participation .5 .0 -.2 -.2 -.2 -.2 -.2
Previous Tealbook .5 .0 -.2 -.2 -.2 -.2 -.2

Note: Components may not sum to totals because of rounding. For multiyear periods, the percent change is the annual average from Q4 of the year preceding the first year shown to Q4 of the last year shown.

1. Percentage points.  Return to table

Figure: Nonfarm Business Productivity

Line chart, 2000 to 2011. Unit is chained (2005) dollars per hour. There is a vertical blue shaded bar that marks the period 2010 to 2011. There is one series, "Structural productivity." It begins at about 42 and gently fluctuates but generally increases ending at about 58. A red line shows the upward trend of the series, also beginning at about 42 and steadily increasing to about 58.

Figure: Labor Force Participation Rate

Line chart, 2000 to 2011. Unit is percent. There is a vertical blue shaded bar that marks the period 2010 to 2011. There is one series, "Trend." It begins at about 67 and gently fluctuates but generally decreases to about 66 in early 2005. It generally increases to about 66 in early 2007 then generally decreases ending at about 64.5. There is also a red line that starts at about 67 and generally decreases ending at about 65.5.


The Outlook for the Labor Market

(Percent change, Q4 to Q4, except as noted)
Measure 2008 2009 2010 2011
Output per hour, nonfarm business 1.4 5.6 1.2 .9
Previous Tealbook 1.4 5.6 1.3 .8
Nonfarm private employment -2.7 -4.7 1.6 3.0
Previous Tealbook -2.7 -4.7 1.9 3.6
Labor force participation rate1 65.9 64.9 64.8 64.7
Previous Tealbook 65.9 64.9 64.7 64.7
Civilian unemployment rate1 6.9 10.0 9.5 8.6
Previous Tealbook 6.9 10.0 9.3 8.2
Memo
GDP gap2 -4.8 -7.3 -6.5 -5.4
Previous Tealbook -4.9 -7.3 -6.3 -4.5

1. Percent, average for the fourth quarter.  Return to table

2. Percent difference between actual and potential GDP in the fourth quarter of the year indicated. A negative number indicates that the economy is operating below potential.  Return to table

Figure: Private Payroll Employment, Average Monthly Changes

Line chart, 1990 to 2011. Unit is thousands. 0 on the scale is marked by a horizontal line. There is a vertical blue shaded bar marking the period of about 2010:Q2 to the end of 2011. There are two series, "Current" and "Previous Tealbook." Both series begin at about 200 and generally decrease together to about -200 in late 1990. They generally increase together to about 300 in early 1994 then fluctuate but remain about constant until early 1999. They generally decrease together to about -400 in late 2001 then generally increase together to about 300 in early 2006. They generally decrease together to about -800 in early 2009 then generally increase together ending at about 300.

Figure: Unemployment Rate

Line chart, 1990 to 2011. Unit is percent. 0 on the scale is marked by a horizontal line. There is a vertical blue shaded bar marking the period of about 2010:Q2 to the end of 2011. There are four series, "Current," "Previous Tealbook," "NAIRU," and "NAIRU with EEB Adjustment." Current and Previous Tealbook begin at about 5.25 and generally increase together to about 7.5 in mid-1992. They generally decrease together to about 4 in late 2000 then generally increase together to about 6 in mid-2003. They generally decrease together to about 4.25 in early 2007 then generally increase together to about 10 in late 2009. They generally decrease together ending at about 8.5.

Note: The EEB adjustment is the staff estimate of the effect of extended and emergency unemployment compensation programs on the NAIRU.

Figure: GDP Gap

Line chart, 1990 to 2011. Unit is percent. 0 on the scale is marked by a horizontal line. There is a vertical blue shaded bar marking the period of about 2010:Q2 to the end of 2011. There are two series, "Current" and "Previous Tealbook." Current and Previous Tealbook begin together at about 0 and generally decrease together to about -4 in late 1991. They generally increase together to about 3.5 in early 2000 then generally decrease together to about -3 in early 2003. They generally increase together to about 0 in early 2006 then generally decrease together to about -8 in late 2009. Current generally increases ending at about -5 and Previous Tealbook generally increases ending at about -4.

Note: The GDP gap is the percent difference between actual and potential GDP; a negative number indicates that the economy is operating below potential.

Figure: Manufacturing Capacity Utilization Rate

Line chart, 1990 to 2011. Unit is percent. 0 on the scale is marked by a horizontal line. There is a vertical blue shaded bar marking the period of about 2010:Q2 to the end of 2011. The Average Rate from 1972 to 2009 is marked as a horizontal line at about 79 percent. The series begins at about 83 and generally decreases to about 77 in late 1990. It generally increases to about 85 in early 1995 then fluctuates but generally decreases to about 70 in late 2001. It generally increases to about 80 in mid-2007 then generally decreases to about 65 in early 2009. It generally increases ending at about 76.

Note: The shaded bars indicate a period of business recession as defined by the National Bureau of Economic Research (NBER): July 1990-March 1991, and March 2001-November 2001. The vertical lines represent the last business cycle peak as defined by the NBER (December 2007).


Inflation Projections

(Percent change, Q4 to Q4)
Measure 2008 2009 2010 2011
PCE chain-weighted price index 1.7 1.2 .9 1.0
Previous Tealbook 1.7 1.2 1.3 1.0
Food and beverages 6.8 -1.7 1.5 .7
Previous Tealbook 6.8 -1.7 1.7 .7
Energy -9.1 1.1 2.3 3.9
Previous Tealbook -9.1 1.1 7.6 2.4
Excluding food and energy 2.0 1.5 .8 .8
Previous Tealbook 2.0 1.5 .9 .9
Prices of core goods imports1 3.8 -1.6 1.7 1.5
Previous Tealbook 3.8 -1.6 2.7 1.2

1. Core goods imports exclude computers, semiconductors, oil and natural gas.  Return to table

Figure: Total PCE Prices

Line chart, 1990 to 2011. Unit is 4-quarter percent change. 0 on the scale is marked by a horizontal line. There is a vertical blue shaded bar marking the period of about 2010:Q2 to the end of 2011. There are two series, "Current" and "Previous Tealbook." Both series begin at about 4 and generally increase together to about 5.5 in late 1990. They fluctuate slightly but generally decrease together to about 1 in late 1998. They generally increase to about 2.5 in 1999 then generally decrease to about 1 in early 2002. The fluctuate slightly but generally increase together to about 4.5 in late 2008 then generally decrease together to about -1 in mid-2009. They generally increase together to about 2in early 2010 then generally decrease together ending at about 1.

Figure: PCE Prices excluding Food and Energy

Line chart, 1990 to 2011. Unit is 4-quarter percent change. 0 on the scale is marked by a horizontal line. There is a vertical blue shaded bar marking the period of about 2010:Q2 to the end of 2011. There are four series, "Current," "Previous Tealbook," "Current: Market-Based," and "Previous Tealbook: Market-Based." Current and Previous Tealbook begin at about 4 and generally increase together to about 4.5 in late 1990 then fluctuate slightly but generally decrease together to about 1.25 in early 1998. They fluctuate slightly but generally increase together to about 2.5 in early 2008 then generally decrease together ending at about 1. Current: Market-Based and Previous Tealbook: Market-Based begin at about 4.5 and generally increase together to about 4.75 in late 1990. They fluctuate slightly but generally decrease together to about 1 in early 1998. They fluctuate slightly but generally increase together to about 2.5 in early 2008 then generally decrease together ending at about 0.75.

Figure: Compensation per Hour

Line chart, 1990 to 2011. Unit is 4-quarter percent change. 0 on the scale is marked by a horizontal line. There is a vertical blue shaded bar marking the period of about 2010:Q2 to the end of 2011. There are four series, "Current: Productivity and Costs," "Previous Tealbook: Productivity and Costs," "Current: Employment Cost Index," and "Previous Tealbook: Employment Cost Index." Current: Productivity and Costs and previous Tealbook: Productivity and Costs begin at about 5 and generally increase together to about 7 in late 1990 then fluctuate but generally decrease together to about 1 in early 1995. They fluctuate but generally increase together to about 9 in early 2000 then fluctuate but generally decrease together to about 0 in early 2010. Current: Productivity and Costs generally increases to about 2 in early 2010 then generally decreases to about 0 in mid-2010. It generally increases ending at about 2. Previous Tealbook: Productivity and Costs generally increases to about 2.5 in early 2010 then generally decreases to about 1 in mid-2010. It generally increases ending at about 2.5. Current: Employment Cost Index and Previous Tealbook: Employment Cost Index begin at about 5 and generally decrease together to about 2.5 in late 1995. They generally increase together to about 4.5 in mid-2000 then fluctuate slightly but generally decrease together to about 1 in late 2009. They generally increase together ending at about 2.

Figure: Long-Term Inflation Expectations

Line chart, 1990 to 2011. Unit is 4-quarter percent change. 0 on the scale is marked by a horizontal line. There is a vertical blue shaded bar marking the period of about 2010:Q2 to the end of 2011. The end of the top series is labeled June (preliminary). The end of the bottom series is labeled Q1. There are two series, "Thomson Reuters/Michigan next 5 to 10 years (top)," and "SPF next 10 years (bottom)." Thomson Reuters/Michigan next 5 to 10 years begins at about 4 and fluctuates but generally increases to about 4.5 in late 1990. It fluctuates but generally decreases to about 2.5 in mid-2001. It fluctuates but generally increases to about 3.5 in late 2008 then generally decreases ending at about 2.5. SPF next 10 years begins at about 4 and generally decreases to about 2.5 in early 1999. It remains about constant until the end of the timeline.

Note: The SPF projection is for the CPI.

Note: The shaded bars indicate a period of business recession as defined by the National Bureau of Economic Research (NBER): July 1990-March 1991, and March 2001-November 2001. The vertical lines represent the last business cycle peak as defined by the NBER (December 2007).


The Long-Term Outlook

(Percent change, Q4 to Q4, except as noted)
2010 2011 2012 2013 2014
Real GDP 3.2 3.7 4.8 4.7 3.9
Civilian unemployment rate1 9.5 8.6 7.1 5.8 5.2
PCE prices, total .9 1.0 1.0 1.2 1.5
Core PCE prices .8 .8 1.0 1.2 1.4
Federal funds rate1 .1 .1 .8 2.5 3.5

1. Percent, average for the final quarter of the period.  Return to table

Figure: Real GDP

Line chart, 2002 to 2014. Unit is 4-quarter percent change. 0 on the scale is marked by a horizontal line. There is a vertical blue shaded bar marking from about 2010:Q2 to the end of 2014. There are two series, "Potential GDP" and "Real GDP." Potential GDP begins at about 3.5 and generally decreases to about 2.25 in early 2005. It generally increases to about 2.75 in late 2009 then generally decreases to about 2.5 in early 2010.It generally increases ending at about 2.75. Real GDP begins at about 1.5 and fluctuates but generally increases to about 4 in early 2004. It fluctuates slightly but generally decreases to about -4 in mid-2009. It generally increases to about 5 in early 2013 then generally decreases ending at about 4.

Figure: Unemployment Rate

Line chart, 2002 to 2014. Unit is percent. There is a vertical blue shaded bar from about 2010:Q2 to the end of 2014. The series begins at about 5.75 and generally increases to about 6.25 in early 2003. It generally decreases to about 4.5 in early 2007 then generally increases to about 10 in mid-2009. It generally decreases ending at about 5.25. Also present is a series representing NAIRU. It begins at about 5 and gradually decreases to about 4.75 in mid-2008. It generally increases to about 5 in late 2009 and remains about constant to the end of the timeline.

Figure: PCE Prices

Line chart, 2002 to 2014. Unit is 4-quarter percent change. There is a vertical blue shaded bar marking from about 2010:Q2 to the end of 2014. There are two series, "Total PCE Prices" and "PCE Prices excluding Food and Energy." Total PCE Prices begins at about 1 and fluctuates but generally increases to about 3 in early 2006. It generally decreases to about 2 in late 2006 then generally increases to about 4.5 in late 2008. It generally decreases to about -0.75 in mid-2009 then generally increases to about 2 in early 2010. It generally decreases to about 1 in late 2010 then generally increases ending at about 1.5. PCE prices excluding food and energy begins at about 1.5 and fluctuates slightly but generally increases to about 2.5 in mid-2008. It generally decreases to about 1 in late 2010 then generally increases ending at about 1.5.

Figure: Interest Rates

Line chart, 2002 to 2014. Unit is percent. There is a vertical blue shaded bar from about 2010:Q2 to the end of 2014. There are three series, "BBB Corporate," "10-Year Treasury," and "Federal Funds Rate." BBB Corporate begins at about 7.5 then generally decreases to about 5.5 in early 2004. It generally increases to about 9.5 in late 2008 then generally decreases to about 5.5 in early 2010. It generally increases ending at about 6. 10-year treasury begins at about 5.5 and generally decreases to about 3.75 in early 2003. It generally increases to about 5 in early 2006 then generally decreases to about 3.25 in early 2009. It generally increases ending at about 4.75. Federal Funds Rate begins at about 1.75 and generally decreases to about 1 in early 2004. It generally increases to about 5 in early 2006 and remains about constant until mid-2007. It generally decreases to about 0 in early 2009 and remains about constant until early 2012. It generally increases ending at about 3.5.

Note: In each panel, shading represents the projection period.


Evolution of the Staff Forecast

Figure: Change in Real GDP

Line chart, Tealbook Publication Date 1/23/2008 to 12/8/2010. Unit is percent, Q4/Q4. 0 on the scale is marked by a horizontal line. There are three series, "2009," "2010," and "2011." 2009 begins at about 2 and generally increases to about 3 on 3/13/2008. It generally decreases to about -2 on 3/12/2009 then generally increases to about 0 on 1/20/2010. It remains about constant until it ends on 6/16/2010. 2010 begins at about 3 on 9/10/2008 and generally decreases to about 2.5 on 10/22/2008. It generally increases to about 3 on 1/22/2009 then decreases to about 1.5 on 3/12/2009. It generally increases ending at about 3 on 6/16/2010. 2011 begins at about 4.5 on 9/16/2009 and generally increases to about 4.75 on 1/20/2010. It generally decreases ending at about 3.75 on 6/16/2010.

Figure: Unemployment Rate

Line chart, Tealbook Publication Date 1/23/2008 to 12/8/2010. Unit is percent, fourth quarter. There are three series, "2009," "2010," and "2011." 2009 begins at about 5.25 and generally increases to about 10 on 6/17/2009. It remains about constant until it ends on 6/16/2010. 2010 begins at about 6 on 9/10/2008 and generally increases to about 9.5 on 3/12/2009. It generally decreases to about 9.25 on 4/22/2009 then generally increases to about 9.75 on 6/17/2009. It generally decreases to about 9.25 on 9/16/2009 then generally increases ending at about 9.5 on 6/16/2010. 2011 begins at about 8 on 9/16/2009 and generally increases ending at about 8.5 on 6/16/2010.

Figure: Change in PCE Prices excluding Food and Energy

Line chart, Tealbook Publication Date 1/23/2008 to 12/8/2010. Unit is percent, Q4/Q4. There are three series, "2009," "2010," and "2011." 2009 begins at about 1.9 and generally increases to about 2.25 on 6/18/2008. It generally decreases to about 1.0 on 1/22/2009 then generally increases to about 1.25 on 6/17/2009. It remains about constant until 10/29/2009 then generally increases to about 1.5 on 12/9/2009 and remains about constant until it ends on 6/16/2010. 2010 begins at about 2.0 on 9/10/2008 then generally decreases to about 0.5 on 3/12/2009. It generally increases to about 1.0 on 1/20/2010 then generally decreases ending at about 0.75 on 6/16/2010. 2011 begins at about 1.0 on 9/16/2010 and generally increases to about 1.25 on 12/9/2009. It remains about constant until 1/20/2009 then generally decreases ending at about 0.75 on 6/16/2010.

Note: Because the core PCE price index was redefined as part of the comprehensive revisions to the NIPA, projections prior to the August 2009 Tealbook are not strictly comparable with more recent projections.


† Note: Data values for figures are rounded and may not sum to totals.  Return to text

Last update: January 29, 2016