Federal Reserve Bank of San Francisco Researcher Provides Details of New Studies and Findings in the Area of Economics (The Effects of Global Supply Chain Pressure on Sentiment, Expectation, and Uncertainty: A VAR Approach): Economics

2024 NOV 19 (NewsRx) -- By a News Reporter-Staff News Editor at Economics Daily Report -- Research findings on agriculture are discussed in a new report. According to news reporting from the Federal Reserve Bank of San Francisco by NewsRx journalists, research stated, “This paper studies the relationship of global supply chain pressure with consumer sentiment, inflation expectation, and monetary policy uncertainty in the United States.”

Our news correspondents obtained a quote from the research from Federal Reserve Bank of San Francisco: “A sample from January 1998 to January 2024 is used, and this paper uses a Vector Autoregression (VAR) approach based on the method proposed by Toda and Yamamoto (1995). The Granger causality test suggests that the predictions of inflation expectation based on its own past values and the past values of the global supply chain pressure are better predictions of inflation expectation than just using the past observations of inflation expectation. In contrast, Impulse Response Functions suggest that surprise increases in global supply chain pressure lead to increased inflation expectation and monetary policy uncertainty; this shock lasts up to two years. Meanwhile, the Impulse Response Functions suggest that surprise increases in the global supply chain pressure decrease consumer sentiment (confidence), lasting up to two and a half years. Afterward, the impact converges back to zero.”

According to the news reporters, the research concluded: “Additionally, the Variance Decomposition results suggest that by the final period, the impulses of the global supply chain pressure explain over 22%, 7%, and 44% of the variation of consumer sentiment, monetary policy uncertainty, and inflation expectation, respectively.”

For more information on this research see: The Effects of Global Supply Chain Pressure on Sentiment, Expectation, and Uncertainty: A VAR Approach. The Anahuac Journal, 2024,24(2). The publisher for The Anahuac Journal is Universidad Anahuac del Sur.

A free version of this journal article is available at https://doi.org/10.36105/theanahuacjour.2024v24n2.2515.

Our news editors report that more information may be obtained by contacting Hector Romero-Ramirez, Federal Reserve Bank of San Francisco, United States.

(Our reports deliver fact-based news of research and discoveries from around the world.)