By CHRISTOPHER RUGABER, Associated Press Economics Writer

WASHINGTON (AP) — When Federal Reserve officials last met in late January, things looked pretty good: Hiring was solid. The economy had just grown at a solid pace in last year’s final quarter. And inflation, while stubborn, had fallen sharply from its peak more than two years ago.

What a difference seven weeks makes.

As the Fed prepares to meet Tuesday and Wednesday, the central bank and its chair, Jerome Powell, are potentially headed to a much tougher spot. Inflation improved last month but is still high and tariffs could push it higher. At the same time, ongoing tariff threats as well as sharp cuts to government spending and jobs have tanked consumer and business confidence, which could weigh on the economy and even push up unemployment.

The toxic combination of still-high inflation and a weak or stagnant economy is often referred to as “stagflation,” a term that haunts central bankers. It is what bedeviled the United States in the 1970s, when even deep recessions didn’t kill inflation.

Stagflation, should it emerge, is hard for the Fed because typically policymakers would lift rates — or keep them high — to combat inflation. Yet if unemployment also rises, the Fed would usually cut rates to reduce borrowing costs and lift growth.

It’s not yet clear the economy will sink into stagflation. For now, like businesses and consumers, the Fed is grappling with a huge amount of uncertainty surrounding the economic outlook. But even a mild version — with the unemployment rising from its current low level of 4.1%, while inflation stayed stuck above the Fed’s 2% target — would pose a challenge for the central bank.

“That’s the tangled web they’re in,” said Esther George, former president of the Federal Reserve’s Kansas City branch. “You have inflation stickiness on the one hand. At the same time, you’re trying to look at what impact could this have on the job market, if growth begins to pull back. So it is a tough scenario for them for sure.”

Fed officials will almost certainly keep their key rate unchanged at their meeting this week. Once the meeting concludes Wednesday, they will release their latest quarterly economic projections, which will likely show they expect to cut their rate twice this year — the same as they projected in December.

The Fed implemented three cuts last year and then signaled at the January meeting that they were largely on pause until the economic outlook becomes clearer.

Wall Street investors expect three rate reductions this year, in June, September, and December, according to futures prices tracked by CME Fedwatch, in part because they worry an economic slowdown will force more reductions.

One development likely to unnerve Fed officials is the sharp jump in inflation expectations this month in the University of Michigan’s consumer sentiment survey. It showed the biggest increase in long-term inflation expectations since 1993.

Such expectations — which basically measure whether Americans are worried inflation will get worse — are important because they can become self-fulfilling. If businesses and consumers expect higher costs, they may take steps that push up inflation, like demanding higher wages, which in turn can force companies to raise prices to offset higher labor costs.

Some economists caution that the University of Michigan’s survey is preliminary and for now based on only about 400 responses. (The final version to be released later this month typically includes about 800.) And financial market measures of inflation expectations, based on bond prices, have actually declined in recent weeks.

The most recent inflation readings have been mixed. The consumer price index dropped last week for the first time in five months to 2.8% from 3%, an encouraging change. But the Fed’s preferred price gauge, to be released later this month, is likely to be unchanged.

The jump in inflation expectations is also a problem for the Fed because officials, including Powell, have said they are willing to let inflation gradually return to their 2% target in 2027, because expectations have generally been low. If other measures show inflation worries rising, the Fed could come under more pressure to get inflation down more quickly.

“I do worry when I see consumer expectations moving in the opposite direction,” George said. “I think you just have to keep an eye on that.”

The last time President Donald Trump imposed tariffs — in 2018 and 2019 — overall inflation didn’t rise by much, in part because they weren’t nearly as broad as what he is currently proposing and some duties, such as those on steel and aluminum, were watered down with loopholes. Now that Americans have lived through a painful inflationary episode, they are likely to be more skittish about rising prices.

Powell referred such concerns in remarks earlier this month. He said tariffs could just have a one-time impact on prices without causing ongoing inflation. But that could change “if it turns into a series” of tariff hikes, he said March 7, or “if the increases are larger, that would matter.”

“What really does matter is what is happening with long-term inflation expectations,” Powell added.

A week after his comments, those expectations shot higher in the University of Michigan survey.

By CHRISTOPHER RUGABER and ANNE D’INNOCENZIO, Associated Press Business Writer

WASHINGTON (AP) — US shoppers stepped up their spending a just bit in February after a sharp pullback the previous month, signaling that Americans are spending more cautiously as concerns about the direction of the economy mount.

Retail sales rose just 0.2% in February, a small rebound after a sharp drop of 1.2% in January, the Commerce Department said Monday. Sales rose at grocery stores, home and garden stores, and online retailers. Sales fell at auto dealers, restaurants, and electronics stores.

The small increase suggests Americans may be growing more wary about spending as the stock market has plunged and President Donald Trump’s tariff threats and government spending cuts have led to widespread uncertainty among consumers and businesses.

On Friday, a measure of consumer sentiment fell sharply for the third straight month and is now down more than 20% since December. Respondents to the University of Michigan’s survey cited policy uncertainty as a leading reason for the gloomier outlook. While the respondents were divided sharply by party — sentiment about the current economy fell among Republican by much less than for Democrats — Republicans’ confidence in the economy’s future dropped 10%.

D’Innocenzio reported from New York.

By KIMBERLEE KRUESI, LEAH WILLINGHAM and RODRIQUE NGOWI, Associated Press

BOSTON (AP) — Tommy McCarthy’s Irish bar just outside Boston’s city limits pours more Guinness than almost anywhere in the U.S., yet come this St. Patrick’s Day, the longtime owner of The Burren is stocking up on plenty of nonalcoholic options too.

“It’s come a long way since we first opened,” McCarthy said, who started slinging pints at the beloved establishment in 1996 after moving to the Boston area from West Clare, Ireland.

A St. Patrick’s Day decoration is displayed between two drink menus at the Burren Pub, Wednesday, March 12, 2025, in Somerville, Mass. (AP Photo/Robert F. Bukaty)

There is perhaps no other holiday tied more to a city than St. Patrick’s Day in Boston. According to historians, the city was the first in the country to throw a celebration for the patron saint of Ireland on March 17, 1737, as a way to support the city’s wave of Irish immigrants.

Yet while the holiday has become connected to heavy drinking over the centuries, a small but growing crowd has found ways to participate in the St. Patrick’s Day parades, festivals and banquets without a buzz. They’re doing so by turning to nonalcoholic beers, mocktails and solely sober spaces — even in the heart of Boston.

A holiday that’s not just about booze

“St. Patrick’s Day is a huge drinking holiday. It is promoted absolutely everywhere,” said Jackie Taylor who has been sober for 12 years.

But she’s found lots of ways to celebrate the holiday — whether out on the town or at home — without risking a situation where “you might not make it out of there sober.”

Nonalcoholic drinks are popular on St. Patrick’s Day weekend during The Burren’s four days of Irish music shows, which can last 10 hours each. McCarthy said he’s a Guinness drinker but sticks to the nonalcoholic brew when playing the fiddle.

Tommy McCarthy, owner of the Burren Pub, pours a non-alcohol Guinness 0, Wednesday, March 12, 2025, in Somerville, Mass. (AP Photo/Robert F. Bukaty)

“I top it up with the real creamy alcohol head,” he said. “You’re only getting a small bit of the alcohol, but you get the real cream. But you’re also getting the taste of the real Guinness without the alcohol. It kind of beats all.”

Michelle Flynn, manager at the Brendan Behan Irish pub in Boston’s Jamacia Plain, said most bars now serve nonalcoholic beers — a significant shift from decades ago.

“The neighborhood, society, everything has changed, has shifted a 1,000% — especially in the youth,” she said.

Young people don’t drink as much anymore

It’s not just bar owners noticing an uptick in a demand for nonalcoholic options. Young adults are drinking less than they were in decades past, according to polling by Gallup, which reported in 2023 that adults under 35 were less likely to say they use alcohol at least occasionally than they were in the early 2000s.

Gallup also saw a decline in the share of young adults who drink regularly or say they sometimes drink “more than they think they should” over the same time period.

Michael Scelfo, chef and owner of four Boston area cocktail bars, said his businesses have served mocktails since he opened Cambridge-based Alden & Harlow 11 years ago. But after the pandemic, demand significantly increased.

“It’s really kind of an expected and formidable part of the menu now,” he said, with bartenders putting just as much care into a mocktail’s execution.

Reclaiming St. Patrick’s Day for Irish heritage

For nearly 15 years, William Spencer Reilly has been throwing a “Sober St. Patrick’s Day” in New York City — which kicks off after the parade with Irish bands, dancers and food — and may soon expand the mission to Boston.

The sober event’s founder and chairman has always had his eye on Boston “for all the obvious reasons.”

According to Reilly, it’s about refocusing the typically-booze forward festivities on celebrating Irish heritage and honoring St. Patrick, the priest born in the late fourth century who was enslaved in Ireland and later returned to promote the spread of Christianity. It’s also a chance to break hurtful stereotypes of Irish people.

When he first proposed the idea of a sober event on such a booze-heavy day, he was met with incredulity and doubt over public interest. Now he’s in talks with Boston’s local leaders and believes there’s finally enough interest and support to branch out next year.

People generally seem more interested in being healthier, said Scelfo. That includes how they choose to spend their holidays.

“The perils and pitfalls of alcohol are well-documented when not used responsibly,” he said. “We’ve got an intelligent young generation that’s focused on health and wellness. And I think that that’s a great thing.”

Krusei reported from Nashville, Tennessee, and Willingham reported from Charleston, West Virginia. Amelia Thomson DeVeaux in Washington D.C. contributed.

By DEEPTI HAJELA, Associated Press

NEW YORK (AP) — If it’s March, and it’s green, it must be St. Patrick’s Day.

The day honoring the patron saint of Ireland is a global celebration of Irish heritage. And nowhere is that more so than in the United States, where parades take place in cities around the country and all kinds of foods and drinks are given an emerald hue.

In fact, it was among Irish American communities that the day became the celebration it is, from its roots as a more solemn day with a religious observance in Ireland.

But even in America, it was about more than a chance to dye a river green (looking at you, Chicago) or just bust out a favorite piece of green clothing, it was about putting down roots and claiming a piece of the country’s calendar.

Who is St. Patrick and why does he even have a day?

Patrick was not actually Irish, according to experts. Born in the late fourth century, he was captured as an adolescent and ended up enslaved in Ireland. He escaped to another part of Europe where he was trained as a priest and returned to Ireland in the fifth century to promote the spread of Christianity.

Several centuries later, he was made a saint by the Catholic Church and like other saints had a day dedicated to him, which was March 17. He became Ireland’s patron saint, and even when religious strife broke out between Catholics and Protestants, was claimed by both, says Mike Cronin, historian and academic director of Boston College Dublin.

How did an Irish saint’s day become an American thing?

The short answer: Irish people came to America and brought their culture with them. St. Patrick’s Day observances date back to before the founding of the U.S., in places like Boston and New York City. The first parade was held in Manhattan in 1762.

While the day was marked with more of a religious framing and solemnity in Ireland until well into the 20th century, in America it became the cultural and boisterous celebration it is today, marked by plenty of people without a trace of Irish heritage.

It was because people in Ireland started seeing how the day was marked in the U.S. that it became more of a festival in the country of its origin rather than strictly a religious observance, Cronin says, pointing to the parades, parties and other festivities that are held.

Oh, and by the way, for those who like to shorten names: Use St. Paddy’s Day, not St. Patty’s Day. Paddy is a nickname for Pádraig, which is the Irish spelling of Patrick.

Why is it such a big deal?

Holidays aren’t simply days to watch bands go by, or wear a specific outfit or costume.

Being able to mark a holiday, and have others mark it, is a way of “putting down roots, showing that you’ve made it in American culture,” says Leigh Schmidt, professor in the Danforth Center on Religion and Politics at Washington University. “You’ve made your claim on that American calendar, in American civic life, by having these holidays widely recognized.”

The spread of St. Patrick’s Day celebrations in the U.S. was a way for Irish immigrant communities, who in the 19th century faced discrimination and opposition, to stake that ground, he says: “It’s a kind of immigrant Irish way of combating nativist antagonism against them.”

What’s with four-leaf clovers, anyway?

A popular sight around the holiday is the shamrock, or three-leaf clover, linked to Ireland and St. Patrick.

The lucky ones, though, come across something that’s harder to find: a four-leaf clover. That’s because it takes a recessive trait or traits in the clover’s genetics for there to be more than the normal 3 leaves, says Vincent Pennetti, who has been fascinated by the plants since high school.

Four-leaf clovers “are real. They are rare,” he says.

That doesn’t mean they can’t be found. People just have to keep their eyes open and “get really good at noticing patterns and breaks in the patterns, and they just start jumping out at you,” he says.

Katie Glerum finds them. She says it’s not unheard of for her to be somewhere like out in a park and see one. She usually scoops it up and often gives it to someone else, to a positive response.

“If it happened every day, then I probably would be less excited about it,” she says. “But yeah, when it happens, it is exciting.”