logo
  

Fed's Beige Book: Interest Rates, Inflation Weighing On U.S. Economy

eccles building 112918 30nov22 lt

After previously describing U.S. economic growth as modest, the Federal Reserve's latest Beige Book said economic activity has been "about flat or up slightly" since mid-October.

The Beige Book, a compilation of anecdotal evidence on economic conditions in each of the twelve Fed districts, said five districts reported slight or modest gains in activity, while the rest experienced either no change or slight-to-modest declines.

The report said interest rates and inflation continued to weigh on activity, with many contacts expressing greater uncertainty or increased pessimism regarding the economic outlook.

Non-auto consumer spending eked out slight gains on balance, the Fed said, as inflation pushed low-to-moderate income consumers toward lower-priced goods.

The Beige Book described manufacturing activity as mixed and noted a slight decline in auto sales and a moderate decrease in home sales amid higher interest rates.

Employment grew modestly in most districts, the Fed said, although two districts reported flat headcounts and labor demand weakened overall.

While labor markets were still described as tight, the report noted further easing in hiring and retention difficulties.

With regard to inflation, the Beige Book said consumer prices rose at a moderate or strong pace in most districts.

Still, the pace of price growth slowed on balance, reflecting a combination of improvements in supply chains and weakening demand, the Fed said.

The Beige Book is typically released two weeks ahead of the Fed's next monetary policy meeting, with the next meeting scheduled for December 13-14.

CME Group's FedWatch Tool currently indicates a 72.3 percent chance of a 50 basis point rate hike and a 27.7 percent chance of a fifth straight 75 basis point rate hike.

For comments and feedback contact: editorial@rttnews.com

Business News

Editors Pick
The U.S. Consumer Product Safety Commission or CPSC announced recall of thousands of children's Robes made in China and sold exclusively on Amazon.com by various companies. The recalled robes fail to meet the federal flammability standards for children's sleepwear, posing a risk of burn injuries to children. Further, citing the same concerns, Paper Cape children's pajamas manufactured in Peru ... Health services company Cigna Corp. reported Friday higher profit in its fourth quarter reflecting growth in both Evernorth and Cigna Healthcare segments. Adjusted earnings and topline beat market estimates. Looking ahead for fiscal 2023, the company projects adjusted earnings and adjusted revenues to be higher than last year, but below market view. French drug major Sanofi SA reported Friday higher profit in its fourth quarter with strong revenue growth mainly with strong sales of Dupixent. Looking ahead for fiscal 2023, the company projects higher business earnings, but the expected growth is slower than recorded in fiscal 2022. Sanofi shares were losing around 4 percent in the morning trading in Paris as well as in pre-market activity...
Follow RTT