outsized. perhaps most important, house prices, while substantially above their recent lows, do not appear broadly elevated relative to rents or disposable income, in contrast to conditions a decade ago. moreover, household - sector debt growth has been modest and driven mainly by prime borrowers, although rapid growth in auto and student lending across the credit spectrum may create repayment challenges for some households. however, signs of valuation pressures are emerging in commercial real estate markets, where prices have been rising at a solid clip and lending standards have deteriorated, although debt growth has not yet accelerated notably. in the corporate debt markets, valuation pressures had been high for a while, before risk spreads widened and issuance slowed over the past year. the high issuance of corporate debt in recent years is evident in the near - record - high debt - to - asset ratios at speculative - grade and unrated corporations, making this sector vulnerable to adverse shocks. in addition, increased defaults could lead to sharper - than - expected price declines if concerns that liquidity in corporate bond markets is not as robust as in the past – a topic to which i will return in a few minutes – turn out to be justified. in the financial sector, regulatory capital ratios remain at historically high levels, and liquidity buffers appear sizable in the banking sector. capital ratios continue to trend upward for both life and property and casualty insurers. the ofr reports its monitoring efforts regularly, including in its annual reports ( available on the ofr website at http : / / financialresearch. gov / annual - reports ). research by ofr staff members on similar issues includes flood and others ( 2015 ). for a more comprehensive review of structural changes since the financial crisis, see my feldstein lecture ( fischer, 2014 ). for a discussion organizing vulnerabilities along these lines, see adrian, covitz, and liang ( 2013 ). bis central bankers ’ speeches a closer look at shadow banking still, our view of developments at nonbank firms that have traditionally relied on high leverage and short - term wholesale funding and were at the center of the financial crisis – the shadow banking sector – remains incomplete. 6 one source of information about leverage at nonbanks is the senior credit officer opinion survey on dealer financing terms ( scoos ), which the federal reserve initiated after the crisis. the scoos provides information about the availability and terms of credit in securities financing and over - the - counter

reaching levels not seen since the 1980s. as energy prices have moderated and supply disruptions have eased, inflation has followed suit and started to abate. last week, data on the consumer price index ( cpi ) 1 / 5 bis - central bankers'speeches showed 12 - month inflation falling to 5 percent in march from a peak of about 9 percent last june. the fed has a preferred consumer price measure, which is the personal consumption expenditures ( pce ) price index. it covers a broader set of goods and services than the cpi, and its weighting of individual prices can change each month to reflect consumer spending behavior. last week's data suggest that pce inflation likely will be somewhat above 4 percent in march, also significantly lower than last june. the big question, however, is whether, and how quickly, inflation will continue its downward path toward our target of 2 percent. much of the decline so far has been driven by the moderation in energy prices, and there is evidence that the path back to our low and stable inflation goal could be long and is likely to be uneven and bumpy. total ( or headline ) inflation tells us something critical about the effect on our daily lives - simply put, people need to eat, pay their bills, and get to work and school, among other things, and their budgets feel the impact. we also look at core inflation, which omits volatile food and energy prices and tends to give a more accurate signal of total inflation's trajectory. the rise and fall in core measures has been less dramatic than that of total inflation. we also look at other measures of underlying inflation, that try to get at the central tendency of inflation, such as median or trimmed - mean inflation. all of these measures have come off their peaks but remain elevated, suggesting that inflation has become broad based in the economy. of course, economic data are generally backward looking. one question is whether timely data can give us a sense of where inflation is going. to this end, i have found several useful sources of data. for instance, to forecast core goods prices - - which drove much of the initial surge in inflation - - i look at various measures of supply chain disruptions and input prices. those indicators helped predict the moderation in goods prices that emerged last fall. for automobiles, where shortages of semiconductors held down production and drove up prices for both new and used cars, i looked at wholesale used car prices as a leading indicator of retail prices. those